Equities close lower for a second straight session as foreign selling continues, while government securities yields tick higher and the rupee eases against the dollar
The Colombo Stock Exchange closed lower on Thursday, extending a decline that has now persisted across several sessions. The All Share Price Index (ASPI) fell 109.98 points, or 0.52%, to close at 21,023.43, while the S&P SL20 Index, which tracks the bourse’s most liquid large-cap counters, dropped 22.33 points, or 0.38%, to 5,924.96.
Trading activity was notably thin. Daily turnover came in at LKR 1.33 billion, down 18.1% from the previous session and 44.3% below the monthly average of LKR 2.4 billion. Share volume also fell, with 55.4 million shares changing hands, a 20.2% decline day-on-day. Total market capitalisation stood at LKR 7,623.60 billion, down 0.6%.
The Capital Goods sector accounted for the largest share of turnover at 21%, followed by the Food, Beverage and Tobacco and Banking sectors, which together contributed 34% of activity. Among individual counters, TESS.X, LVEN, GEST, EML and UBF posted the day’s largest gains, while CRL, CLND, LGL.X, TAJ and BRR were among the steepest decliners.
Foreign investors remained net sellers, recording a net outflow of LKR 213.1 million for the day. This brings the month-to-date foreign outflow to LKR 1,107.9 million and the year-to-date figure to LKR 56.8 billion, underscoring a sustained pattern of foreign divestment from the local bourse this year rather than a one-day shift.
In fixed income markets, secondary trading in government bonds was mixed, with both buying and selling interest recorded across maturities from the 2028 to 2034 segments. At a Treasury bill auction settled during the week, accepted yields rose across all three tenors compared to the previous auction, continuing a broader upward trend in short-term rates. Liquidity in the banking system contracted to LKR 317.84 billion from LKR 336.44 billion previously.
On the currency front, the rupee eased against the US dollar, closing at LKR 331.89 compared to LKR 330.18 previously.
Business Impact
Thin equity turnover and continued foreign outflows point to cautious investor positioning, which businesses reliant on capital markets for fundraising should factor into timing decisions. Rising short-term government yields and tighter banking system liquidity may translate into firmer borrowing costs for corporates and SMEs in the near term. Importers and businesses with dollar-denominated obligations should note the rupee’s continued gradual depreciation.
What to Watch Next
Market participants will be watching whether foreign selling persists, how banking system liquidity conditions evolve following this week’s contraction, and whether Treasury yields continue their upward trajectory at upcoming auctions.
Key Numbers
| Metric | Value | Change |
|---|---|---|
| ASPI | 21,023.43 | -109.98 (-0.52%) |
| S&P SL20 | 5,924.96 | -22.33 (-0.38%) |
| Turnover | LKR 1.33 Bn | -18.1% |
| Volume | 55.40 Mn shares | -20.2% |
| Market Cap | LKR 7,623.60 Bn | -0.6% |
| Net Foreign Flow (Daily) | -LKR 213.1 Mn | — |
| Net Foreign Flow (MTD) | -LKR 1,107.9 Mn | — |
| Net Foreign Flow (YTD) | -LKR 56,848.3 Mn | — |
| USD/LKR | 331.89 | from 330.18 |
| Banking System Liquidity | LKR 317.84 Bn | from LKR 336.44 Bn |
Source Attribution
Source: Colombo Stock Exchange market data, Central Bank of Sri Lanka statistics and publicly available market information.