Foreign Outflows pass Rs 1.5 billion due to uncertainty


Net foreign outflows (NFOs) from the stock market passed the Rs 1.5 billion mark in the calendar year to yesterday, due to persistent foreign investor uncertainty. Yesterday’s NFOs amount to Rs 117.8 million, increasing NFOs to Rs 1,516.2 million in the calendar year to date.  Yesterday was also the third consecutive market day that the bourse has suffered NFOs

Prior to yesterday, the last time the stock market suffered NFOs for three consecutive market days was seven calendar days ago, where for  five consecutive market days, from 2 August to 8 August, it suffered NFOs. Nonetheless, the stock market made pyrrhic gains for the twelfth consecutive market day to yesterday, with the ASPI, yesterday over Friday increasing by 1.82 per cent to 9,191.52 points and the S&P SL 20 Index by 0.82 per cent to 3,097.30 points on a Rs 5.83 billion turnover.

 Prior to yesterday, the last time stock market indices made high figures than these were four-and-a-half calendar months ago on 30 March with values of 9,294.89 points and 3,196.19 points, vis-à-vis the ASPI and S&P SL 20 indices, respectively.

Meanwhile, the stock market, for the first time after four-and-a-half calendar months passed the Rs four trillion mark vis-à-vis market capitalization (MC) with a value of Rs 4.02 trillion registered yesterday. Prior to yesterday, the last time MC passed the Rs four trillion rupees mark was on 29 March with a value of   4.17 trillion.

In related developments, prior to yesterday, the last time the stock market made gains for at least12 consecutive market days was nearly  one calendaryear and seven months ago, where, for a total of 14 consecutive market days, from 24 December 2020 to 18 January 2021, the bourse, led  by a low interest rate regime made such consecutive gains. Yesterday was also the seventh consecutive market day that the stock market made a turnover of over Rs three billion.The last time prior to yesterday that thestock market made over a Rs three billion daily turnover for  a minimum of seven consecutive market days was more than six calendar months ago, where for 31 consecutive market days, from 27 December 2021 to  10 February 2022, it made daily turnovers of over Rs three billion.

“Spot” Unchanged 30th Day

The benchmark, albeit administered market “spot” closed unchanged for the thirtieth consecutive market day at Rs 360/364 to the US dollar in two way quotes to yesterday, market sources told “Finance Today.”

Yesterday, the administered market “spot” was down by between 78.22-79.31 per cent (Rs 158-161) year on year (YoY); thereby causing cost push inflationary pressure as Sri Lanka is an import dependent economy, they said.

The band in which the “guided market ‘spot’” may currently operate is fixed at +/- three per cent of the officially administered “spot” value, where the latter is applicable for transactions involving the GoSL, CBSL and or between the GoSL and/or CBSL with the market, which was fixed at Rs 360.94 to the dollar yesterday.

They further said that trades in the administered market “spot” (Rs 360/364) yesterday were mainly restricted to “bank-client” outright trades, while the interbank foreign exchange (FX) market was however dominated by swaps, which were outside the domain of the FX market for this purpose.

In like developments, the administered “spot” for official purposes, such as for trades involving CBSL, GoSL and/or CBSL, GoSL and the market, YoY to   yesterday has depreciated by  80.50 per cent (Rs 160.93).

BY PaneethaAmeresekere