General
Sri Lanka opposition slams Harsha de Silva ouster from finance committee
ECONOMYNEXT – Sri Lanka’s stocks gained to close at a two-month high on Friday as the market continues on positive macroeconomic sentiments fueled by higher profits of banks in the December quarter 2022, brokers said.
The All Share Price Index (ASPI) gained 0.65 percent, or 59.88 points, to reach 9,315.87, the highest for the year so far.
“Given that the banking sector is performing well and shows the ability to withstand economic downturns, investors are receiving higher dividends,” an analyst said.
“It may increase their confidence in the bank and further stabilize the market.”
The loan from the IMF was originally expected in December of last year, but it is now expected in the second quarter.
On Tuesday, President Ranil Wickremesinghe said that the agreement with the International Monetary Fund, which was negotiated after a severe currency crisis ended in external default, will be presented to parliament for approval, and the parliament ‘will have the option to pass or reject it.’
India and the Paris Club have given specific assurances to restructure the sovereign debt of Sri Lanka’s external borrowing, while China offered a two-year moratorium and debt restructuring during that time.
However, some countries, including the United States, have asked China for specific assurances.
Meanwhile, foreign reports quote IMF Asia and Pacific Department Director Krishna Srinivasan as saying that the IMF has not yet made a decision on whether to approve Sri Lanka’s External Fund Facility (EFF), and is not currently considering doing so until financial assurances are received from China.
However, Srinivasan also stated that it is premature to speculate on whether the IMF would be willing to proceed to the next stage of granting Executive Board approval before receiving the necessary assurance.
Net foreign outflows were 115 million rupees on Friday, while the market has bought a net of 3.2 billion worth of shares so far this year.
“Investors are also slowly moving, waiting for potential information at the Monetary Policy Review which is to be held on March 02,” an analyst said.
The most liquid index, S&P SL20, closed 0.33 percent, or 9.36 points, down at 2,833.45.
The market saw a turnover of 2.1 billion rupees on Friday, higher than this year’s daily average of 1.8 billion rupees and lower than the 2022 average turnover of 2.9 billion rupees.
The top gainers were Sampath Bank, Ceylon Tobacco Company, and Commercial Bank. (Colombo/Feb 24/2023)
