ECONOMYNEXT – Sri Lanka’s shares closed at four-month high on Friday after news of the Paris Club member’ willingness to give financial assurances which could help to access a $2.9 billion International Monetary Fund (IMF) loan, analysts said.
The positive sentiment helped to boost both market turnover and net foreign buying to their highest in six week, the course data showed.
All Share Price Index (ASPI) gained by 1.73 percent or 156.23 points to 9,178.61, the highest since October 6.
“Investors are willing to invest as macroeconomic conditions are coming to place,” an analyst said.
The economy has been stabilizing after disinflation was witnessed for the last three months and the Central Bank has said it could cut interest rates in future when the the country sees fall in inflation.
Financial stocks including banks and insurances have seen some rise due to the latest financial assurance ever since India gave the green light on debt restructuring the banking counters have seen drastic interest, the analyst said.
“Risks coming with the debt restructuring haven’t affected the investor sentiment and they are willing to take risks in investing,” the analyst said.
The Central Bank expects Sri Lanka to get the financial aid from the IMF by the first quarter or in the first month of the second quarter.
The most liquid index S&P SL20 gained by 1.81 percent or 50.89 points to 2,863.64.
The market saw a massive turnover of 4.1 billion rupees today, its highest since December 21 more than twice of this year’s daily average of 1.9 billion rupees, and significantly higher than the 2022 average turnover of 2.9 billion rupees.
The bourse saw a net foreign inflow (NFI) of 893 million rupees, its highest since December 21, extending the net offshore buying to 1.87 billion rupees so far this year.
Top gainers were Commercial Bank, Hatton National Bank and Sampath Bank. (Colombo/Feb03/2023)