Business
Possible gains for Sri Lankan bourse from rising US inflation
By Hiran H.Senewiratne
The CSE could look forward to more foreign investments coming into the market with the US inflation rate soaring to more than 7.5 per cent currently. When inflation hits these heights, foreign investors could consider investing in other countries’ equity markets, especially in frontier markets like Sri Lanka, stock market analysts said.
The CSE closed in the green regaining Rs. 65 billion of lost value but the rebound yesterday was not strong enough to push the year- to -date ASPI to a gain, signaling CSE is not yet out of the woods. However, the stock market travelled in a positive direction overall because Central Bank Governor Ajith Nivard Cabraal gave the assurance that there will be no default by Sri Lanka in the US $ 1 billion international sovereign bond repayment, scheduled towards the middle of the year. Sections of the international media reported that Sri Lanka would be rescheduling the repayment of international sovereign bonds this year due to the current financial crisis, market analysts explained.
Yesterday the stock market started on a positive note but at one point during the first half of the session the market slowed down. Later it picked up with a strong buying interest for all blue-chip companies. Accordingly, the market was driven by blue chip companies yesterday, market analysts said.
The ASPI’s year to date return, still reflected a negative 0.15 per cent after having lost over 4 per cent last week. S&P SL20 reduced its YTD negative return to 2.8 per cent from 4.27 per cent on Wednesday. The All- Share Price Index went up by 252 points and S and P SL20 rose by 124 points. Turnover stood at Rs 2.9 billion sans a crossing.
In the retail market top seven companies that mainly contributed to the turnover were, Expolanka Holdings Rs 392 million ( 1.2 million shares traded), Browns Investments Rs 219 million (3.7 million shares traded), Sunshine Holdings Rs 201 million (3.7 million shares traded), ACL Cables Rs 158 million (1.4 million shares traded), Vallibel One Rs 123 million (1.5 million shares traded), Royal Ceramic Rs 115 million (1.6 million shares traded) and Softlogic Holdings Rs 107 million (1.4 million shares traded). During the day 95 million share volumes changed hands in 34000 transactions.
Yesterday, several blue- chip companies drove the market. There was Expolanka Holdings, whose share price gained Rs 16 or five per cent. Its share price shot up to Rs 334 from Rs 318; Sunshine Holdings share price appreciated by 10 per cent or Rs 4.70. Its share price moved to Rs 54.40 from Rs 49.70 and Watawala Plantations share price appreciated by seven per cent or Rs 9.25. Its share price shot up to Rs 138.75 from Rs 129.50.
Further, main contributors to the All- Share Price Index were LOLC 47 points, Expolanka Holdings 32 points, Royal Ceramic Rs 18.5 points and Hayleys 10 points.
It is said that high net worth and institutional investor participation was noted in LOLC Holdings, Sunshine Holdings and ACL Cables. Mixed interest was observed in Expolanka Holdings, Vallibel One and Softlogic Life Insurance, while retail interest was noted in SMB Leasing non-voting, Browns Investments and Renuka Agri Foods.
Yesterday, the US dollar was quoted at Rs 203.40, which was the controlled price of the Central Bank.
The total outstanding market liquidity surplus or excess funds available in Sri Lanka’s banking system for lending and transactions declined by Rs. 36.65 billion in a week, according to the Central Bank’s latest economic indicators report.
An economic researcher analysing the data noted: “Treasury bill and bond auctions likely drained liquidity. If this tightening persists, short-term interest rates could rise, raising borrowing costs and potentially slowing economic growth. The situation warrants close monitoring, especially as the manufacturing sector is already facing a slowdown whether due to seasonal or structural factors.”
The report also highlighted the following developments in Sri Lanka’s economy:
Fiscal improvements: The deficit has narrowed but remains elevated.
Sectoral trends: The stock market rallied, and the services sector showed slower expansion (tourism, retail and IT driving resilience).
Total expenditure and net lending increased to Rs. 1,301.9 bn during the three months ending March 2025 compared to Rs. 1,197.5 bn in the corresponding period of 2024.
During the three months ending March 2025, the overall budget deficit decreased to Rs. 234.5 bn compared to Rs. 281.3 bn recorded in the corresponding period of 2024
The rupee value of T-Bills and T-Bonds held by foreign investors decreased by 2 per cent in comparison to the previous week.
“The April 2025 industrial slowdown points to weaker output, likely due to seasonal factors such as holidays or subdued demand. However, this was partially offset by an expansion in the Services PMI, offering some relief. The broader economic outlook for Sri Lanka remains uncertain, as these mixed signals unfold as Sri Lanka would receive a tariff letter from the US in the coming weeks. With market liquidity already tightening due to government borrowings from the banking system, policymakers face mounting challenges in balancing growth and stability,” the economic researcher noted.
By Sanath Nanayakkare
AIA Sri Lanka’s ‘Pawfect Match’ campaign, in partnership with animal welfare groups, inspired 500+ adoptions of stray pets. The initiative highlighted adoption, responsible ownership, and compassion, tackling Sri Lanka’s stray animal crisis. AIA thanks all supporters for their life-changing impact.
The campaign served as a reminder that even small acts of kindness like adopting a stray can make a big impact. It also provided an opportunity for the public to learn more about responsible pet ownership, animal rights, and the importance of compassion toward all creatures.
Calton Sweet House Pvt. Ltd., a key part of Calton Group, was honored as the Best National Industry Brand in the Medium-Scale Food and Beverage Sector at the National Industry Brand Excellence Awards 2024, organized by the Industrial Development Board. Deshamanya Mahesh De Silva, Director of Finance and IT at Calton Group, accepted the award.
Established in 1991, Calton Sweet House has over 30 years of excellence, specializing in cakes, snacks, and frozen bakery items, with 20+ outlets across Negombo, Katunayake, and Colombo, including at Bandaranaike International Airport. The company holds ISO, HACCP, and GMP certifications, ensuring top-quality standards.
Starting as a small store in 1983, Calton Group now employs 300+ staff and operates multiple businesses, including Calton Hyper Market and Calton Catering, while partnering with global brands like Unilever and Upfield. The group remains committed to serving customers with high-quality, safely packaged food products.
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