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Tuesday June 18th, 2024

Sri Lanka SEC welcomes stock surge, calls for informed decision-making

ECONOMYNEXT – Sri Lanka’s Securities and Exchange Commission has welcomed a surge in the Colombo Stock Exchange making it one of the best performing markets in the world but called for informed decision making.

“The SEC through its social media platforms has educated investors on different aspects of investing and the need to make an informed investment decision,” the regulator said.

“With the view of protecting investors, the SEC has highlighted the importance of following the official channels of the SEC and the CSE and other accredited investment advisors in making decisions to invest in the stock market.

“The SEC has also uploaded a list of Registered Investment Advisers (RIAs) attached to Stock Broker Firms on its website www.sec.gov.lk.

“Steps have also been taken to enlighten the investors on prohibited conduct in order to ensure that they stay away from conduct that would amount to market offences.”

The Coronavirus pandemic had prevented the SEC from conducting its educational programs physically and has been using social media in addition to print and electronic media.

“The SEC launched its own social media platform with a Facebook Page, Twitter Account and a YouTube Channel in mid last year attracting a large viewer base,” the regulator said.

“The SEC realized the need to step in and offer proper guidance to new investors since not all content appearing in the social media was conducive towards creating awareness and guidance to them.

“The SEC through its social media platforms has educated investors on different aspects of investing and the need to make an informed investment decision.”

On January 15, there had been 61,772 trades were driving the CSE index by 291 points and turnover to 12.4 billion rupees. Market Capitalization was 3.38 trillion rupees.

Over the past eight months the CSE All Share Index had risen 75 percent, and the S&P SL 20 Index had surged 65 percent since May.

The ASPI of the CSE has recorded a significant growth of 75% during the last 8 months. The Blue-Chip S&P SL 20 Index has surged by almost 65% sinceMay 2020.

The average daily turnover so far in 2021 was 7.94 billion rupees compared to 1.8 billion in 2020. In 2019 it was only 711 million.

“This phenomenal performance of the CSE indicates the strong confidence the investors have on the Market,” the SEC said.

“It is heartening to note that local investors have stepped in at a time when there has been a foreign outflow and their contribution amounted to 80 percent of the total market turnover in 2020.”

“There have been several contributory factors to this unprecedented performance of the stock market and main amongst them was the slashing of Bank interest rates by the Central Bank of Sri Lanka last year.

“The stock market has become the preferred choice of a large number of investors due to this prevailing low interest rate regime.

“Political stability coupled with progressive steps taken by the government to develop the capital market too has had its positive effects.

“The creation of a State Ministry for Capital markets in August of last year as well as the salutary proposals introduced by the November Budget aimed at providing relief to the stakeholders of the capital market are noteworthy signals sent out by the government to demonstrate its commitment.”

“Truly humbled by the confidence displayed by investors in our economy,” State Minister for Money and Capital Markets, Nivard Cabraal said in a twitter message last week.

The digitization initiative had also helped bring new investors the SEC said.

“The ease with which one could open an account and start trading has resulted in the opening of a large number of CDS accounts online during the past few months,” the SEC said.

“Out of the total number of new accounts opened by resident individuals during the period September – December 2020, 92% have been opened online through the Mobile App.”

Under a second phase of digitalization by March, opening process of company accounts and foreign accounts, will be decentralized. A smart wallet would be introduced and an E portal where clients can directly access and view their accounts will be available. (Colombo/Jan16/2020)

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  1. sacre blieu says:

    There are still the fraudsters of the previous stock market fiasco, who have not been charged , and are free to roam and are active. All these members should have been suspended from participation by now.

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Your email address will not be published. Required fields are marked *

  1. sacre blieu says:

    There are still the fraudsters of the previous stock market fiasco, who have not been charged , and are free to roam and are active. All these members should have been suspended from participation by now.

Sri Lanka’s Ceylon Chamber links up with Gujarat Chamber

ECONOMYNEXT – The Ceylon Chamber of Commerce has signed an agreement with the Southern Gujarat Chamber of Commerce and Industry (SGCCI) to increase trade cooperation between India and Sri Lanka.

The MOU was signed by CCC CEO Buwanekabahu Perera, SGCCI President Ramesh Vaghasia, in the presence of Dr Valsan Vethody, Consul General for Sri Lanka in Mumbai, India.

“With the signing of the MoU, … the Ceylon Chamber of Commerce and SGCCI aim to facilitate trade between the two countries via initiatives such as trade fairs and delegations, business networking events, training programmes,” the Ceylon Chamber said in a statement.

“This partnership will open doors for Sri Lankan businesses to explore opportunities in Surat’s dynamic market and enable the sharing of expertise and resources between the two regions.”

Established in 1940, SGCCI engages with over 12,000 members and indirect ties with more than 2,00,000 members via 150 associations. It promotes trade, commerce, and industry in South Gujarat.

The region’s commercial and economic centre Surat has risen to prominence as the global epicenter for diamond cutting and as India’s textile hub, and is ranked the world’s 4th fastest growing city with a GDP growth rate of 11.5%

Surat’s economic landscape is vibrant and diverse. As India’s 8th largest and Gujarat’s 2nd largest city, it boasts the highest average annual household income in the country.

The nearby Hazira Industrial Area hosts major corporations like Reliance, ESSAR, SHELL, and L&T. (Colombo/Jun18/2024)

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Sri Lanka telecommunications bill some clauses ruled unconstitutional by SC: Speaker

ECONOMYNEXT – Sri Lanka’s Supreme Court has found a number of clauses in a proposed amendment to the Telecom Telecommunications Amendment bill unconstitutional, speaker Mahinda Yapa Abeywardana said.

“Clause No 8, proposed section 9A 2 of the bill is inconsistent with Article 12 1 of the constitution, however this inconsistency shall cease if word ‘may’ will be replaced with word ‘shall’ as set out in the determination of the supreme court.”

“Clause No 9 is inconsistent with Article 12 1 of the constitution and only can be passed with special majority required under paragraph 2 of the Article 84. However, the inconsistency shall cease if clause is amended as set out in the determination of the supreme court.

Clause No 12, proposed section 17 10 of the bill is inconsistent with Article 12 1 of the constitution and can only be passed with special parliament majority required under Article 84 paragraph 2. However, the inconsistency shall cease if clause is amended as set out in the determination of the supreme court.”

Sections of clauses 13, 18, 20, 33 and 35 were also in violation of the constitution, and could only be passed by a special majority of parliament. (Colombo/Jun18/2024)

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Sri Lanka to exempt one house from imputed rent wealth tax: President

ECONOMYNEXT – Sri Lanka will exempt one house from a proposed wealth tax outlined in an International Monetary Fund program, President Ranil Wickremesinghe said.

About 90 percent of the people’s houses are likely to be exempt from the proposed tax, he said.

“[O]ne house will be exempt from this,” President Wickremesinghe told parliament Monday.

“It is going to have a very high threshold and I do not think the vast majority of the people in this country should even be worried about their house

“Don’t worry your house will be safe.”

The IMF program document however did not mention an exempt on one house, but did mention a threshold.

Taxing houses and thrift in general could have detrimental effects on people’s well-being housing stock and their willingness to remain in the country without migrating, critics say.

Related Sri Lanka to tax imaginary rents on houses under IMF deal

The mechanism of imputed rents was used because rates on houses was assigned to provincial councils and courts could strike it down.

Opposition legislator Harsha de Silva said the Samagi Jana Balwegaya welcomed President Wickremesinghe’s statement. (Colombo/June18/2024)

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