The Colombo Bourse experienced a volatile trading session, as investors reacted to the implementation of the electricity tariff hike effective today by exerting increased selling pressure.
The ASPI opened on a steady note but was soon subjected to selling pressure, declining sharply into negative territory. Around midday, the index rebounded and recovered steadily amid volatility, ultimately closing broadly unchanged with a modest 4-point gain at 17,661.
The key positive drivers of the index were CARG, LFIN, SAMP, DIAL and CFIN. HNW investors demonstrated limited activity, while retail investors remained active, with increased selling focused on conglomerates such as JKH, LOLC, and HAYL.
Turnover stood at LKR 3.7Bn, marking a decrease of 29% relative to the monthly average of LKR 5.2Bn. The Diversified Financials sector led today's turnover, contributing 25%, followed by the Banking, and Capital Goods sectors, jointly accounting for 33%. Foreign investors turned net buyers, with a net inflow of LKR 8.7Mn.
BOND MARKET
Yield curve holds steady amid pre-auction buying
The secondary market yield curve saw moderate trading volumes and heightened activity, while remaining broadly stable.
Prior to the bond auction, buying interest was observed, particularly in the 2028 and 2029 maturities. As a result, bonds maturing on 15.02.2028, 15.03.2028, and 01.05.2028 traded within a range of 8.65% to 8.75%.
Meanwhile, maturities on 15.06.2029, 15.09.2029, and 15.12.2029 traded between 9.35% and 9.49%. CBSL conducted a T-Bond auction today, which saw the initially offered amount of LKR 111.0Bn was fully raised.
This amount was raised through the issuance of 2029 and 2032 maturities which registered weighted average yields of 9.41%, and 10.29% respectively. In the forex market, the LKR appreciated marginally against the greenback, closing at LKR 299.98/USD, compared to the previously seen rate of 299.10/USD.
Meanwhile, overnight liquidity in the banking system contracted to LKR 178.6Bn from LKR 184.8Bn in the previous session.
Courtesy: First Capital Research
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