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Sri Lanka stock market recovers from circuit breaker, down 30-pct in 2020

ECONOMYNEXT – Sri Lanka stocks closed 3.29 percent lower Tuesday taking the market down 30 percent so far in 2020, but stocks recovered from an opening low which triggered a circuit breaker for the second day after a 7-week closure, brokers said.

The S&P SL20 index of more liquid stocks closed 3.97 or 69.93 points down at 1, 690.60 after recovering from a over 5 percent in the first 10 ten minutes which triggered a circuit breaker.

On Monday after a 7-week closure which foreign investors warned would have consequences for the country, the sensitive index fell over 10 percent within 38 second leading to a close of trading for the day.

Colombo’s All Share Price Index (ASPI) closed 144.48 points down at 4,247.95.

The index is down 30.6 percent so far this year amid Coronavirus pandemic and currency collapse in 2018 triggered by money printed to target a call money rate with excess liquidity, which led to bad loans and a consumption collapse.

There have been calls to reform the central bank to bring monetary stability and end currency depreciation which had made Sri Lanka a lagging nation in Asia from around 1952, when the first draconian exchange controls started to come.

Market turnover was 3.64 billion with 54 stocks making gains while 108 stocks fell.

The day’s turnover was boosted by an internal transaction of 3.018 billion rupees in Watawala Plantations.

The market which fell in early trade recovered on high trade volumes and gradual pickup after circuit breaker.

Sampath Bank and Commercial Bank of Ceylon recorded the highest number of trades for the day with 900 and 819 trades respectively also largely contributive to market turnover.

Retail activity on Tuesday was high with 8, 000 trades which is above average, brokers said. There were no crossings for the day.

Ceylon Tobacco Company declined 100.20 rupees or 10.20 percent to close at 899.80 rupees a share, contributing heavily to the ASPI’s loss.

Index-heavy John Keells Holdings fell 13.00 rupees or 12.14 percent, closing at 94.10 rupees a share.
Ceylon Cold Stores closed 56.50 rupees or 8.63 percent lower at 598.50 rupees a share.
(SB-Colombo/May12/2020)