Market stages strong recovery; ASPI ends 5% higher

After an extremely choppy ride on Thursday, which caused much consternation among investors, the Colombo Stock Exchange (CSE) bounced back remarkably well yesterday, both indices recording sharp gains, regaining the lost ground.

The benchmark All Share Price Index (ASPI) yesterday recorded the highest single-day points gain of 387.19 index points or 5.10 percent to close at 7,985 points while the more liquid S&P SL 20 gained 40.96 index points or 4.64 percent to close at 3,180.24 points.

The turnover for the day was Rs.5.1 billion, higher than Thursday’s Rs.4.3 billion.

Brokers said the clarification issued by the Securities and Exchange Commission (SEC) on broker credit helped market sentiment. 

The recent circulars issued by the CSE asking for broker credit information caused much anxiety in the market, although both the CSE and SEC maintained that the request for such information was merely routine.

SEC Chairman Viraj Dayaratne during a meeting with stockbroker CEO on Thursday had explained that such information had anyhow been collected on a fortnightly and monthly basis and considering the dynamic nature of the market, some such information was required to be submitted on a weekly basis and that it was in no way meant to curtail credit granted by the stockbrokers.

Meanwhile, the brokers said positive corporate results also contributed to today’s market recovery. Companies like Singer Sri Lanka, Royal Ceramics and Lanka Walltiles recorded exceptionally improved performances for the quarter ended on December 31, 2020.