Sri Lanka market closed for day after 38 seconds as stocks plunge
ECONOMYNEXT – Sri Lanka’s stock market closed trading for the day 38 seconds after the market re-opened on May 11 following a 7 week closure that upset foreign investors as a key index plunge over 10 percent.
The Colombo Stock Exchange’s S&P SL 20 index fell 10.1 percent on opening, crashing through a 5 percent circuit breaker.
Under market rules trading closes for the day when the index falls 10 percent.
Trading was halted 38 seconds after open, in the shortest trading day of the markets history.
It is not clear why the market was closed for 7 weeks but several mis-steps had happened in Sri Lanka’s economic policy recently.
The stock market which had a sophisticated trading system, was closed while Sri Lanka tea auctions went online.
Sri Lanka stocks had been hit by prolonged monetary instability, and a fiscal stimulus in the form of a tax cut in January. Monetary instability also resumed from early March amid another bout of stimulus.
Analysts had expected the market to fall around 10 to 15 percent before recovering on a best case scenario and about 30 percent in a worse case.
On Monday when the S&P SL 20 Index fell 196 points with about 100 points or about half the fall was accounted for by Sampath Bank, Commercial and John Keells Holdings, market official said.
Sampath Bank fell 19 rupees to 100, JKH fell 8.30 to 107.10 and Commercial Bank fell 5.10 cents to 55 rupees.
Trading was thin at only 24 million rupees, with 4.1 million shares traded. (Colombo/May11/2020)