An Echelon Media Company
Thursday March 23rd, 2023

Sri Lanka stocks edge up after President’s policy statement amid protests 

ECONOMYNEXT – Sri Lanka shares edged up on Wednesday on dull sentiments over rising protests against tax hikes, which is also expected to hit corporate earnings in the face of reduced consumption, analysts said.

“The President’s address in Parliament assured that the country would be seeing tough times in the road to recovery and that taxes are here to stay,” an analyst said.

Protests were staged against the tax hikes on Wednesday in capital Colombo citing it is “unfair” and does not comply with cost of living especially since income has not reflected inflationary hikes.

If protests resurface, investors could pull down investor momentum towards shares, the analyst said.

“The investors are looking at a positivity towards the IMF, there is no concrete confirmation on that but they are looking at a positive direction with the IMF,” the analyst said.

All Share Price Index (ASPI) edged up by 0.13% or 11.59 points 8,987.45

“Investors are willing to invest if macroeconomic conditions come into place and there are further developments to an assured IMF deal,” an analyst said.

President Wickremesinghe said that Sri Lanka had reached the final stage of negotiations with the International Monetary Fund and that a basic agreement last September was agreed for and now there is the debt sustainability program.

The Central Bank expects the IMF deal to be finalized by the end of the first quarter or fist month of second quarter.

Sri Lanka got assurances from India, Paris Club and China towards debt restructuring in order to secure 2.9 billion dollars for an IMF loan.

The IMF has so far only accepted the letter of debt re-structuring sent by India.

However, the IMF has still not approved restructuring assurances from Paris Club and China.

China’s Exim Bank has given Sri Lanka a two-year moratorium on its defaulted loans and will discuss additional re-structuring within the ‘window’, the Chinese Foreign Ministry spokesperson Mao Ning said last week,

“The international support demonstrates that we are on the right path,” President Wickremesinghe said.

John Keells Holdings has been receiving high amounts of foreign buying after announcements with regard to the opening of Cinnamon Life in 2025.

The most liquid index S&P SL20 closed down at 0.09 percent or 2.63 points to 2,782.56.

The market saw a turnover of 1.1 billion rupees today, comparatively lower to the year’s daily average of 1.9 billion rupees, and significantly lower than the 2022 average turnover of 2.9 billion rupees.

The bourse saw a net foreign inflow (NFI) of 291 million rupees.

Top losers during the closure was HNB, LOLC, DFCC.

Leave a Comment

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

Leave a Comment

Leave a Comment

Cancel reply

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

Sri Lanka establishes committee to investigate aircraft incidents

An aircraft lands at the Jaffna International Airport, which was opened in October 2019 and promises to push the tourism frontiers in Jaffna.

ECONOMYNEXT: Sri Lanka’s has established an expert committee under the state-run Civil Aviation Authority to investigate aircraft accidents and to implement precautionary methods in the Sri Lankan airspace, an Official said.

“Even if it is only one flight, there is a chance an accident may occur,” Civil Aviation Authority of Sri Lanka, Director General, P. A. Jayakantha said.

“This particular committee is there to investigate aircraft accidents and act as a mechanism to take over if something goes wrong”.

Sri Lanka has encountered around 2,700 minor aircraft accidents and incidents mostly on the ground in the 19 years through 2021, the CAA annual reports showed.

The new committee will analyze the past accidents and take precautionary measures while also conducting investigations and provide independent reports in the future, Jayakantha said.

The team is provided with required training and qualifications by the CAA along with an International organization, free of charge.

“Internationally also it is a requirement to have a team to investigate the aircraft accidents,” Jayakantha added.

“For a long time we have not fulfilled this requirement and that is why we established this team with the cabinet approval. Moreover, recently, Sri Lanka’s two aircrafts, one training aircraft and a commercial aircraft met an accident”

The committee will be on active duty, until the Accident Investigation Act is passed and a proper Aircraft Accident and Incident Investigation Bureau is established. (Colombo/ Mar23/2023)

Continue Reading

Sri Lanka bond yields steady, Rupee 319/325 at close

ECONOMYNEXT – Sri Lanka’s treasury bond yields closed steady on Thursday while rupee closed weaker, dealers said.

A 01.07.2025 bond closed at 30.60/31.00 percent on Tuesday, down from 30.25/75 percent on Wednesday.

A 15.09.2027 bond closed at 27.80/28.10 percent, steady from 27.90/28.00 percent from Wednesday.

Sri Lanka rupee closed at 319/325 against the US dollar depreciating from 318/320 from a day earlier. (Colombo/ March23/2023)

Continue Reading

Sri Lanka shares dive to two-week low on local debt restructuring fears

ECONOMYNEXT – The Sri Lanka market fell for a fourth session to a two-week low on Thursday, led by financials, as worries over domestic debt restructuring continued after the IMF loan was approved earlier this week resulting in investors adopting a wait-and-see approach until further clarity was provided, analysts said.

The main All Share Price Index (ASPI) closed down 1.38 percent or 131.07 points to 9,395.98, lowest since March 02.

Analysts said, majority of the banks have been on slower investment trends on fears of domestic debt restructuring after the IMF approval and waiting for more clarity on the local debt restructuring.

“The market is on muted sentiments despite the IMF loan being approved and is going through a period of consolidation,” Ranjan Ranatunga of First Capital Holdings said.

The market saw a net foreign outflow of 298 million rupees and the total offshore inflows recorded so far in 2023 to 3.3 billion rupees.

The most liquid index, S&P SL20, closed 1.64 percent, or 45.33 points, down at 2,722.94.

The market saw a turnover of 3.4 billion rupees on Thursday, above this year’s daily average of 1.8 billion rupees.

This is the highest turnover generated since March 08, which is when the market was driven off of positive sentiments from International Monetary Fund deal hope after Chinese assurances.

Top contributors to revenue was Agalawatte Plantations, on off board transactions of a stake change, contributing revenue of 1.6 billion rupees, Ranatunga said.

Top contributors to revenue industry wise was Food and Beverage and Telecommunications.

Sri Lanka Telecom has been seeing positive uptrends as the Secretary to the Treasury has informed the Board of Directors of Sri Lanka Telecom PLC (SLT) and Lanka Hospitals PLC that the Cabinet of Ministers has granted approval in principle for the divestment of the stakes held by the Treasury Secretary in the two companies.

Top losers were Sampath Bank, Hatton National Bank and Commercial Bank.

Sri Lanka is looking at options to re-structure domestic debt, or local law local currency debt (LLLC), without harming the banking sector and announce them the International Monetary Fund said in a report.

Banks have been witnessing profit taking and selling pressures after continuous uptrends prior to the IMF loan had been approved.

Analysts said, selling pressures is expected to ease as the IMF hopes to reduce inflationary pressures which will in turn lead to reductions in interest rates. (Colombo/Mar23/2023)

Continue Reading