The Colombo Bourse advanced during early trading, supported by the decline in T-Bill yields at yesterday’s weekly T-Bill auction, but failed to sustain the momentum, slipping into negative territory by mid-session before moving sideways and closing 11 points lower at 21,406.

Participation from both retail and HNW investors remained low. Furthermore, SAMP, BREW, BUKI, JKH and CDB emerged as the top negative contributors to the index. Daily turnover stood at LKR 1.5Bn, marking a decrease of 50.9% over the monthly average of LKR 3.1Bn.

Banking sector led the daily turnover with a share of 33%, followed by the Capital Goods, and Insurance sectors collectively contributing 26%. Foreign investors turned net sellers, posting a net outflow of LKR 24.8Mn.

BOND MARKET

Buying sentiment persists in the long-end maturities

The mixed sentiment persisted in the secondary market today, with moderate volumes and market activity. Among the executed trades, 2030 segment saw some profit taking with 01.03.2030, 01.08.2030 and 15.10.2030 traded between 10.75%-10.90%.

On the other hand, 01.02.2031 maturity saw buying interest, trading at 10.95%. Moving ahead, 01.10.2032 changed hands at 11.20%. Moreover, 15.01.2033 and 01.11.2033 traded in the range of 11.53%-11.35% and 01.08.2036 and 01.07.2037 traded between 12.10%-12.00%.

On the external front, the LKR marginally appreciated against the USD, standing at LKR 331.23/USD, compared to LKR 331.83/USD seen earlier. Market liquidity in the banking system expanded to LKR 300.25Bn from LKR 288.98Bn recorded previously.

Popular maturities:

01.03.2030: +18bps

01.08.2030: +3bps

15.10.2030: -6bps

01.11.2033: -6bps

01.07.2037: -4bps

-First Capital Research