By The Sunday Morning Business Desk Foreign outflows from Sri Lanka’s government securities market reduced drastically in the first week after the resolution of the political crisis, however no such impact was seen on the outflows from the equity market, with foreigners selling stocks at an even higher rate than during the crisis. Sri Lanka’s treasury bills and bonds held by foreigners came down at a weekly average of Rs. 8.01 billion during the crisis period from 29 October to 14 December. However, last week these holdings came down by only Rs. 670 million amidst the stability provided by the resolution of the crisis. However, the stock market reacted very differently, with foreigners selling even more now than they were during the crisis. The weekly average net foreign outflow from the Colombo Stock Exchange (CSE) from 29 October to 14 December was Rs. 1.51 billion. In the first week since the end of the crisis, foreigners sold stocks worth Rs. 3.1 billion, far higher than the weekly average. A leading stock market analyst opined that foreign investors were wary, and are now adopting a wait-and-see approach as things would not go back to normal immediately. “Because of the way foreigners were burnt with the sudden change in October, it will not go back to business as usual in a day or two. It will depend on how forward-looking the policies of the new Government are. The UNP Government appears to be sticking to the populist policies of Mahinda Rajapaksa because they have to win over the masses. This is not good news for fiscal consolidation.” The bond and stock markets collectively saw a net foreign outflow of Rs. 66.58 billion during the crisis period.