Sri Lanka stock plunges before ending over 1-month low amid dented sentiment
ECONOMYNEXT – Sri Lanka stocks closed 4.3 percent weaker on Thursday (04) to more than one-month low as investor sentiments continued to dent over falling container freight and fuel prices while the market is going through a correction, dealers said.
The stock exchange went for a circuit break within the first few minutes of trade as the liquid index S&P SL20 plunged over 5 percent for the second day.
The index however settled at 5.7% or 173.66 points down at 2,875.05.
The main All Share Price Index (ASPI) fell 412.81 points to close at 9,237.05, the lowest since August 31. It has dropped 7 percent in the last two session.
“The market continued to fall on selling pressure in in Expolanka shares as global freight prices dropped,” a market analyst said. Analyst have also said foreign buying in Expolanka has now slowed and thus the price is falling.
Another analyst said the market is going through a correction as it crossed the 10,000 benchmark.
The market saw a turnover of 4.54 billion rupees, higher than this year’s average turnover of 3.2 billion rupees.
The bourse saw a net foreign inflow of 21 million rupees on Tuesday. The inflow so far this year is 15.3
billion rupees after 16.7 billion rupees of net offshore buying in the last 36 consecutive sessions amid
positive sentiment over an IMF deal.
The market saw its highest monthly net foreign inflows into stock market last month in more than 10 years as some foreigners converted their dividend payment into risky assets because they could not get dollars to repatriate due to forex crisis.
The island nation’s 4.3 trillion worth stock market saw 14.7 billion rupees ($40.8 million) net foreign
inflow in September, its highest since March 2012.
The index has lost 24.4 percent so far this year after being one of the world’s best stock markets with an 80 percent return last year when large volumes of money were printed.
Lanka IOC closed 13.7 percent lower at 236.3 rupees a share.
Expolanka closed 11.4 percent down at 174.7 rupees and Sampath Bank ended 5.2 percent
weaker at 38.2 rupees a share. (Colombo/Oct04/2022)
