Extending the previous day's negative sentiment, the Colombo Bourse recorded a broad-based decline as selling pressure persisted across most counters.

Investor sentiment remained subdued amid uncertainties surrounding the US-Iran conflict. Consequently, the ASPI declined by 62 points to close at 21,146, while the S&P SL20 Index edged up by 2 points to settle at 5,945.

Market participation from both retail and HNW investors remained subdued. CINS, COMB, RICH, CARS, and HARI were the top five negative contributors to the ASPI.

Daily turnover amounted to LKR 3.3Bn, representing a 107.4% increase over the monthly average of LKR 1.6Bn. The higher turnover was primarily driven by a LKR 2.3Bn crossing in CARG, which accounted for 69.1% of the total turnover.

Food & Staples Retailing sector led the daily turnover with a share of 71%, followed by the Food, Beverage & Tobacco, and Banking sectors collectively contributing 15%. Foreign investors remained net buyers, posting a net inflow of LKR 79.8Mn.

BOND MARKET

Secondary market records moderate activity ahead of tomorrow's monetary policy announcement

Ahead of tomorrow's monetary policy announcement and T-bill auction, the secondary bond market recorded moderate trading activity as investors positioned cautiously ahead of the key events.

Foreign buying interest remained concentrated in the 2030 maturities, while local selling pressure was evident in the 2031 maturities. Against this backdrop, yields at the belly end of the curve, particularly in the 2031 and 2034 maturities, increased by around 15bps.

Among the actively traded securities, the 15.09.2029 maturity traded at 11.15%. The 15.10.2030 maturity, which saw notable foreign buying interest, traded within a range of 11.65%–11.60%.

In the 2031 segment, the 15.03.2031, 15.05.2031, and 01.12.2031 maturities traded between 11.95% and 12.01%. In the 2032 segment, the 01.07.2032, 01.10.2032, and 15.12.2032 maturities traded in the 12.00%–12.10% range.

Meanwhile, the 15.06.2034 maturity traded at 12.25%. On the external front, the LKR slightly depreciated against the USD, standing at LKR 336.27/USD, compared to LKR 336.23/USD seen earlier. Overnight liquidity in the banking system marginally contracted to LKR 162.36Bn from LKR 168.13Bn recorded previously.

Popular maturities:

15.10.2030: Unchanged

-First Capital Research