Colombo stock market gains to its highest since Jan. 5

COLOMBO: Sri Lanka’s stock market gained to its highest since January 5, but foreign investors dumped shares a day after global rating agency S&P downgraded the island nation’s sovereign rating by a notch on the country’s high external debts, dealers said.

Foreign investors sold a net of 188 million rupees, extending the net foreign selling to 2 billion rupees so far this year. In 2021, the Sri Lanka stock market suffered a net foreign outflow of 50 billion rupees.

Despite expected better earrings in the December quarter, lingering currency depreciation concerns had weighed on the sentiment.

The main All Share Price Index (ASPI) closed 1.64 percent or 215.54 points up on Thursday to close at 13,338.49 points.

S&P SL20 of the more liquid index too gained 4.13 percent or 64.11 points to 4,554.94.

Analysts have expected the market to recover from two session fall early this week ahead of long holidays during the weekend.

They say investors have nowhere to invest their money.

Analysts also said people are expecting better earnings from all the companies in the December quarter. Corporate earnings are expected to be released next week onward.

The day’s turnover of 7 billion rupees more than last year’s daily average of around 4 billion rupees.

Analysts say many investors are now coming into stocks because of negative returns and see high turnovers these days after the market return jumped to 80 percent last year.