Continuing its negative run for the second consecutive day, ASPI closed the day in red as investor confidence took a hit after the Central Bank governor commented that Sri Lanka will have the worst economic contraction during 2022.
Further, due to inadequate macroeconomic policy framework in the country, World Bank have also stated that they won’t provide any new loans to Sri Lanka (except for the already approved loans), which also contributed towards the dampened sentiment.
Meanwhile, today’s turnover was the lowest in a week at LKR 1.7Bn (down c.28% compared to yesterday), as investors remained sidelined due to the uncertainty surrounding the country’s macro picture.
Energy sector had the biggest contribution to aggregate turnover with c.28% whilst Food & Beverage sector had the next biggest contribution of c.18%. Meanwhile, foreign investors were the net sellers for the day.
Auction yields taper across the board
The secondary market yield curve remained broadly unchanged amidst thin volumes. Meanwhile at the bill auction held today, the total offered amount of LKR 90.0Bn was fully accepted with 66.80% of the amount being accepted from 03M T-Bill.
Moreover, yields of 03M, 06M and 01 Year T-Bills declined to 23.65% (-42bps), 24.22% (-47bps) and 24.30% (-20bps), respectively. Post auction in the secondary market, 03M maturity traded in the range of 22.00%-21.50% while 06M and 1Yr maturities traded at 23.50% and 23.75% respectively.
Courtesy: First Capital Research
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