The Colombo bourse surged during the preceding week as turnover improved amidst low interest rates, resulting in money flowing from the Government securities market to the equity market and an improved interest for margin trading.

Speaking to The Sunday Morning Business, First Capital Holdings Research Manager Ranjan Ranatunga stated that collections had been taking place across the board over the last two weeks, which had seen the average market turnover increase to around Rs. 1.5 billion from the previous daily average of Rs. 700-800 million.

He revealed that the improved turnover was a result of the low interest rates and attractive margins on offer, which had led to increased credit trading.

Ranatunga further pointed out that the decrease in yields on offer in the Government securities market had resulted in the increased flow of money to the equity market. He noted that the preceding week had seen a bullish run on LOLC Group counters, largely due to market speculation.

Responding to a query on foreign interest in the market, he revealed that the preceding week had seen net foreign selling as most foreigners had sought to exit their positions amidst improved market turnover.

During the preceding week, the benchmark All Share Price Index (ASPI) gained 300 basis points, crossing the 11,000 points mark for the first time since 8 October 2023. Similarly, the blue chip Standard & Poor’s Sri Lanka 20 (S&P SL20) index also gained over 110 basis points during the week.

Major developments in the market during the preceding week include the corporate disclosure by Ceylon Land & Equity PLC (formally known as Shaw Wallace Investments PLC) that it had raised Rs. 1.1 billion by allotting 121,148.276 new shares. 

Furthermore, the shares of Arpico Insurance PLC were transferred to the Watch List on 7 March due to the non-submission of the Interim Financial Statement as at 31 December 2023.