Low investor sentiment persisted in the stock market yesterday due to lingering West Asian uncertainties particularly in relation to Israel and Lebanon.

Both indices moved downwards. The All Share Price Index went down by 48.78 points, while the S and P SL20 declined by 7.46 points. Turnover stood at Rs 1.67 billion with two crossings.

Those crossings were; HNB crossed 185718 shares to the tune of Rs 73.4 million; its shares traded at Rs 395 and Dialog Axiata 1 million shares crossed for Rs 44 million; its shares traded at Rs 44.

In the retail market companies that mainly contributed to the turnover were: RIL Properties Rs 148 million (5.3 million shares traded), Dialog Rs 108 million (2.4 million shares traded), Aitken Spence Rs 74.4 million (542,100 shares traded), LB Finance Rs 72.2 million (7.3 million shares traded), Royal Ceramics Rs 67.2 million (1.4 million shares traded), Renuka Agri Foods Rs 64.8 million (5.2 million shares traded) and JKH Rs 53.7 million (2.7 million shares traded). During the day 71 million shares volumes changed hands in 23582 transactions.

It is said that banking sector counters, especially HNB, performed well while the real estate sector stocks, especially RIL Properties, performed well. An overall mixed performance was noted in most of other sectors, especially finance and agriculture.

Yesterday the rupee was quoted at Rs 330.00/332.00 to the US dollar in the spot market, from 331.00/332.00 Friday, dealers said, while bond yields were flat.

By Hiran H Senewiratne

First Capital Holdings PLC, a subsidiary of JXG (Janashakthi Group) and a pioneering force in Sri Lanka’s capital markets landscape, delivered a steady performance during FY2025/26, recording a Profit after Tax of Rs. 2.10Bn for the year ended 31 March 2026. While this compares to Rs. 5.02Bn recorded in the previous year, the Group’s performance reflects its ability to navigate a dynamic operating environment while sustaining long-term value creation.

The year was shaped by the impacts of the devastating cyclone ‘Ditwah” as well as heightened geopolitical tensions arising from the Middle East conflict, which negatively influenced broader capital market conditions. Additionally, the settlement of long-standing tax assessments relating to VAT on financial services that impacted reported outcomes during the latter part of the year. Against this backdrop, the Group remained focused on maintaining operational stability, disciplined execution and strategic continuity across its business verticals.

The Primary Dealer and Corporate Debt Securities businesses continued to deliver strong operational performance, contributing to a Net Income before Operating Expenses of Rs. 6.59Bn for FY2025/26. With a disciplined execution focus and a well-structured business model, the Group remains well-positioned to capitalize on improving market conditions and future growth opportunities.

The Group’s Primary Dealer division recorded a Profit after Tax of Rs. 1.60Bn for the year ended 31 March 2026, supported by Rs. 1.75Bn in net interest income and Rs. 1.44Bn in trading gains from government securities, reaffirming its position as a key contributor to the Group’s performance.

The Corporate Finance Advisory and Dealing Securities division delivered a Profit after Tax of Rs. 0.93Bn, supported by Rs. 2.29Bn in equity trading gains, driven by sustained client engagement, strong execution capabilities and continued market activity.

Meanwhile, the Stock Brokering division recorded a Profit after Tax of Rs. 242Mn, compared to Rs. 71Mn in the previous year, supported by improved market participation, higher execution volumes and enhanced operational efficiencies.

The Wealth Management division reported a Profit after Tax of Rs. 84Mn, while Assets Under Management stood at Rs. 96.2Bn as of 31 March 2026, reflecting continued investor confidence, prudent portfolio management and the strength of the Group’s advisory platform.

In January 2026, First Capital was awarded Superbrands status, further reinforcing its position as one of Sri Lanka’s most trusted and recognised financial services brands.

Commenting on the Group’s performance, Rajendra Theagarajah, Chairman of First Capital Holdings PLC, stated that FY2025/26 was characterised by evolving global and domestic market conditions that influenced investor sentiment and capital market activity, particularly during the latter part of the financial year. He said that the Group’s ability to maintain operational strength amidst changing market dynamics reflects the value of its diversified business model, structured governance framework and prudent strategic direction. He further commented that First Capital remains focused on sustaining long-term stakeholder value while continuing to strengthen its position within Sri Lanka’s financial services sector.

Dilshan Wirasekara, Managing Director/CEO of First Capital Holdings PLC, highlighted that the Group’s core operating segments continued to deliver meaningful contributions throughout the year, supported by strong client engagement, execution strategy and the strength of its integrated financial services platform. He noted that the Group continued to invest in strengthening capabilities across advisory, fixed income, stock brokering and wealth management, enabling greater agility and service excellence across its operations. He further added that these strategic investments, combined with a strong market presence and client-centric approach, will continue to support the Group’s long-term growth ambitions and future value creation.

With a strengthened foundation across fixed income, capital markets, advisory, stock brokering and wealth management, First Capital enters the new financial year with confidence and strategic clarity. The Group remains focused on deepening its leadership position, enhancing client value and driving sustainable growth through focused execution and continued innovation.

The Colombo Consumer Price Index1 (CCPI, 2021=100) based headline inflation (year-on-year, Y-o-Y) remained marginally above the target in May 2026, reflecting the impact of upward adjustments to domestic energy prices amidst the ongoing conflict in the Middle East.

Accordingly, headline inflation (Y-o-Y) was recorded at 5.5% in May 2026 compared to 5.4% in April 2026.

Non-Food inflation (Y-o-Y) accelerated to 7.8% in May 2026 from 6.8% in April 2026, contributing to the increase in headline inflation. Meanwhile, Food inflation (Y-o-Y) decelerated to 0.9% in May 2026 from 2.8% in April 2026.

On a month-on-month basis, the CCPI recorded an increase of 0.9% in May 2026. This increase was driven by the Non- Food category, which contributed 0.6 percentage points, largely owing to the increase in prices of the Housing, Water, Electricity, Gas, and Other Fuels (L.P. Gas) and Transport (Petrol) sub-categories, while the Food category contributed 0.3 percentage points.

Meanwhile, core inflation (Y-o-Y) accelerated marginally to 3.9% in May 2026 from 3.8% in April 2026. Amid the fluid nature of the tensions in the Middle East and the wide-ranging spillovers across both global and domestic economic activity, the domestic inflation outlook remains subject to elevated uncertainty. Inflation projections made at the monetary policy round in May 2026, based on currently available information and assumptions, indicate that headline inflation is likely to remain above the target of 5% in the period ahead, before easing and stabilising around the target over the medium term, supported by appropriate policy measures.