Sustained uncertainty coupled with rate pressure saw Rs 44.16 billion worth of shareholder wealth being wiped out at yesterday’s trading as panicky investors sold to have liquid cash in possession to meet an uncertain future.
This ‘gloom and doom’ scenario was complemented by market capitalisation declining by 1.37 per cent to Rs 3.19 trillion; ASPI by 1.31 per cent to 7,359.55 points and the S&P SL 20 Index by 1.48 per cent to 2,345.08 points at the end of yesterday’s trading.
Meanwhile, current rate pressure is caused by a near record high 100 per cent inflation. High inflation is conducive to the fixed income/deposit market as a high inflationary environment drives rates higher to counter soaring inflation, thereby making the fixed income market more attractive to investors rather than the Bourse.
Meanwhile, turnover made yesterday was Rs 1.31 billion on a 109.78 million share volume. However, the bourse enjoyed a pyrrhic net foreign inflow of Rs 28.46 million yesterday, though in the calendar year to date it has suffered a net foreign outflow of Rs 1.31 billion.
By Paneetha Ameresekere