Sri Lanka stock market gains from near 6-week low

COLOMBO: Sri Lanka’s stock market gained on Thursday from a near six-week low as investors were on the buying side cautiously in a thin trade bargain hunting of shares which had steeply fallen in the last few sessions, brokers said.

The day’s turnover was near seven-week low.The main All Share Price Index (ASPI) gained 1.04 percent or 125.77 points to close at 12,207.46 points, gaining from its lowest close since December 30 hit on the previous day.

“…investors started bargain hunting following the price decline during the past few days,” First Capital Market said in its daily market note.

Some analysts have predicted the market to consolidate around the 11,800-12,000 range.

Large caps like Expolanka and LOLC have dragged the index down in the past few days.

Investors have questioned the sustainability of earnings with the ongoing forex crisis most companies going through, analysts have said.

S&P SL20 of the more liquid index up 1.60 percent or 64.95 points to 4,117.53.Foreign investors, who are highly worried about possible sharp depreciation or devaluation in the currency, bucked the trend for the third straight session and bought a net of 5 million rupees and were net buyers for the third straight day.

The foreign sales so far this year has been 3.3 billion rupees. In 2021, the Sri Lanka stock market suffered a net foreign outflow of 50 billion rupees.

Analysts had predicted that the economic concerns would drag the market from time to time until the government finds a sustainable solution for the country’s looming debt crisis.

The day’s turnover was 3.5 billion rupees, its lowest since Dec. 24 and less than half of this year’s daily average of 7.4 billion rupees.

Analysts said investors are worried about possible currency depreciation, the government’s ability to avert a sovereign debt default, and fuel shortages hitting factory manufacturing and thus hitting future earnings.

LOLC Holdings, Expolanka and Royal Ceramic pushed the index up on Thursday.

LOLC Holdings gained 5.22 percent to 1,099.25 rupees a share, while Expolanka, the market heavyweight which has export and freight businesses, gained 2.91 percent to close at 318.00 rupees.

Royal Ceramics moved up 2.59 percent to 67.40 rupees a share.