Amid escalating tensions in the Middle East following the breach of the ceasefire agreement between the US and Iran, the Colombo Bourse commenced trading on a weaker note.

However, the ASPI recovered part of its losses during the latter part of the session, supported by news that the IMF had reached a staff-level agreement on the fifth and sixth reviews of Sri Lanka’s Extended Fund Facility, ultimately closing at 21,845, down 73 points.

The S&P SL20 index closed at 6,076, declining by 14 points. CINS, DIAL, JKH, MELS and CTHR were the top negative contributors to the ASPI. Overall market sentiment remained subdued, with HNW participation noted in blue-chip counters, although overall participation levels were relatively low.

Daily turnover stood at LKR 3.0Bn, marking a decrease of 27.2% over the monthly average of LKR 4.1Bn. Capital Goods sector led the daily turnover with a share of 30%, followed by the Food Beverage & Tobacco, and Banking sectors collectively contributing 27%. Foreign investors remained net sellers, posting a net outflow of LKR 221.4Mn.

BOND MARKET

Secondary market records thin volumes amid emerging selling pressure

The secondary market witnessed subdued levels of activity, resulting in thin volumes whilst the market swayed towards selling sentiment overall. Among the traded maturities, at the short end, the 01.05.2027 maturity traded at a yield of 8.70%.

Further along the curve, the 15.06.2029 and 15.10.2029 maturities traded within the 9.80% to 10.00% range. Lastly, the 01.03.2030 maturity traded at 10.00%, while the 15.12.2032 maturity traded at 10.85%. The PDMO raised a sum of LKR 82.1Bn via the scheduled T-Bond auction that took place today.

The funds were raised across 3 maturities, with LKR 30.0Bn through the 01.07.2030 bond, LKR 33.6Bn through the 01.06.2034 bond and LKR 18.5Bn across the 01.07.2037 bond.

Weighted average yields stood at 10.12%, 11.16% and 11.19%, respectively. On the external front, the LKR appreciated against the USD, standing at LKR 315.22/USD compared LKR 315.45/USD compared to previous day. Liquidity in the banking system expanded to LKR 239.96Bn from LKR 237.26Bn recorded previously.

-First Capital Research-