Sri Lanka stocks bucks falling trend on bargain hunting
ECONOMYNEXT – Sri Lanka stocks gained on Wednesday (19) for the first time in four straight sessions as investors bought into beaten-down shares but the day’s turnover slumped to a seven-week low, brokers said.
The market saw a turnover of 1.5 billion rupees, its lowest since August 29 and lower than this year’s average turnover of 3.2 billion rupees.
The main All Share Price Index (ASPI) rose 0.25 percent or 22.32 points to close at 8,888.37.
“We see buyers coming back into the market after the continuous slip. But it’s in minimal numbers. The turnover is a good indicator of it,” a market analyst said.
Shares have been in a falling trend following the proposed tax hikes that were gazetted last week with companies expecting their profits to decline as the increased taxes are likely to reduce the disposable income of the general public, dealers said.
The appropriation bill for the 2023 budget which is expected to be a blueprint of the country’s reform package was tabled in the parliament on October 18. It has allocated 613 billion rupees to the Finance Ministry, including debt service costs with a high allocation for defence and pensions.
Following the tax hike, stockbrokers said that the market has become bearish as investors moved to a wait-and-see approach as they expect the move to hit the fourth quarter earnings.
The most liquid index S&P SL20 closed 0.11 percent or 3.04 points higher at 2,677.37.
The index has lost 10.4 percent so far this Month and 27.2 percent year-to-date after being one of the world’s best stock markets with an 80 percent return last year when large volumes of money were printed.
Richard Pieris, leading the index gain, closed 2.3 percent higher at 27 rupees a share.
Sampath Bank gained 1.1 percent to 35.8 rupees a share while Royal Ceramics closed 2.4 percent firmer at 34.2 rupees a share. (Colombo/Oct19/2022)
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