The Colombo Bourse opened on a negative note, weighed down by continued concerns over rising global oil prices, before gradually recovering during the second half of the session.

The market managed to move into positive territory for the first time in three sessions, as it clawed back its earlier losses and gained momentum towards the close.

The ASPI gained 25 points to close at 21,383, while the S&P SL20 remained relatively unchanged, losing 1 point to close at 6,002, reflecting the mixed performance across the broader market.

Top positive contributors to the ASPI were HAYC, CARG, SAMP, LOLC and SEMB.X. Turnover remained low as investors continued the wait-and-see approach observed in the previous session, with retail participation remaining subdued.

Although several crossings contributed to market activity, overall trading remained muted amid cautious investor sentiment. Daily turnover stood at LKR 1.1Bn, marking a decrease of 55.8% over the monthly average of LKR 2.6Bn. Capital Goods sector led the daily turnover with a share of 30%, followed by the Materials, and Food Beverage & Tobacco sectors collectively contributing 28%. Foreign investors turned net sellers, posting a net outflow of LKR 50.5Mn.

BOND MARKET

PDMO concludes T-Bond auction; 2030 tenor takes the spotlight

The T-Bond auction took center stage today, with investor interest in the secondary market primarily concentrated within auction-bound tenors. While overall investor activity appeared limited, trading volumes remained moderate.

Prior to the T-Bond auction, activity clustered around the 2030 segment. Consequently, driven by selling sentiment, 01.08.2030 and 15.10.2030 traded between 10.75% and 10.80%. The PDMO concluded the T-Bond auction, raising a total of LKR 150.0Bn.

Bulk of this, amounting to LKR 70.0Bn, was raised through a 2030 maturity, bearing a coupon of 10.00% and a weighted average yield of 10.83%. LKR 50.0Bn and LKR 30.0Bn were raised via 2034 and 2037 maturities which had coupon rates of 11.70% and 10.75% respectively.

The weighted average yield recorded for the 2034 maturity was 11.96% while that of the 2037 maturity stood at 12.08%. Modest investor activity was evident following the conclusion of the T-Bond auction, though investor interest continued to remain within auction-bound tenors.

Overall sentiment turned mixed, with 01.08.2030 trading at 10.85% and 15.10.2030 trading higher at 10.90% while 01.07.2037 was seen changing hands at 12.00%. On the external front, the LKR appreciated marginally against the USD, standing at LKR 328.60/USD, compared to LKR 328.75/USD seen earlier. Market liquidity in the banking system remained stable at LKR 366.11Bn compared to LKR 366.20Bn recorded previously.

-First Capital Research-