Bourse took a reversal note as ASPI closed the day in the green zone, breaking the 3-day negative sentiment amidst the reactivated interest on the banking sector counters (mainly COMB, SAMP and HNB) expecting clear direction on the DDO process by the end of May 2023.

As investors expected interest rates to continue to ease down at the weekly T-Bill auction, investor sentiment gradually improved on Treasury counters. Although, index plunged further until mid-day, sizable volatility was observed as active collection was reactivated on Banks towards the end of the trading after being heavily beaten down during the past few days.

Turnover marginally improved to LKR 727.5Mn yet slightly remained below 0.4% cf. monthly average turnover of LKR 730.8Mn on the back of improved Institutional investor participation on Banking and Food, Beverage & Tobacco sectors which led the market turnover with a contribution of 36%. Meanwhile, foreign investors turned net sellers while recording moderate participation.

Market witness prolonged dullness with subdued selling interest

The secondary bond market observed muted investor sentiment amidst ultra-thin volumes and limited activities. However, slight selling interest was observed on short to mid tenors, where 01.05.24 traded at 29.00% and 01.05.27 traded at 26.75%. Moreover, the LKR appreciated against the USD as it was recorded at LKR 305.88 at the end of the day.

Courtesy: First Capital Research