Colombo share market experienced a slight decline today as the ASPI fell by 60 points, closing at 15,848 with turnover reaching LKR 1.6Bn, which depicts a 23.4% decline from the monthly average of LKR 2.1Bn.
Participation from HNW investors was evident, with crossings seen today as well. The market showed volatility throughout the day, initially rising in the morning, followed by a decline in the second half.
This downturn was mainly due to negative contributors from CINS, JKH, HNB, DFCC, and CFIN, which dampened market performance.
The Banking sector was the largest contributor to turnover, accounting for 38%, followed by the Capital Goods and Food, Beverage & Tobacco sectors, which jointly contributed 32%. Foreign turned net buyers, with a net inflow of LKR 133.8Mn.
Selling sentiment persists, bond yields stay resilient
Following the conclusion of the second Monetary Policy Review for 2025, during which the Overnight Policy Rate (OPR) was left unchanged, the secondary market saw sustained selling pressure.
This trend extended from the previous day, as market participants adjusted their positions and exhibited continued selling interest. Nevertheless, the yield curve remained relatively stable, with considerable trading activity and moderate volumes.
At today’s T-Bill auction, weighted average yields remained stable. Total bids accepted amounted to LKR 73.4Bn, falling short of the initially offered sum of LKR 100.5Bn. Specifically, LKR 4.8Bn was raised in 3M T-Bills, LKR 31.2Bn in 6M T-Bills, and LKR 37.4Bn in 12M T-Bills.
The weighted average yields for 3M, 6M, and 12M maturities remained unchanged at 7.50%, 7.84%, and 8.25%, respectively. The secondary market yield curve showed minimal movement despite the prevailing selling sentiment today.
The 15.09.2027 maturity traded between 9.37% to 9.50%. Moving ahead, the 15.02.2028 and 01.05.2028 maturities traded within the range of 9.75% to 9.85% while the 15.10.2028 and 15.12.2028 maturities traded between 9.95% to 10.05%.
Moreover, the 15.09.2029 and the 15.12.2029 maturities transacted between 10.20% and 10.30%. Finally, the 15.10.2030 maturity traded between 10.30% to 10.40% while the 01.07.2032, 01.10.2032 and 15.12.2032 all traded within the range of 10.60% to 10.90%. In the forex market, the LKR appreciated against the greenback and stood at LKR 296.6/USD, compared to 296.7/USD recorded on the previous day.
Meanwhile, overnight liquidity in the banking system contracted to LKR 167.0Bn from LKR 169.7Bn recorded on the previous day.
Courtesy: First Capital Research
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