Market takes a breath post-bullish surge

By First Capital Research

Investor sentiment paused momentarily following a substantial buying momentum witnessed in previous days, indicating a period of stabilisation ahead of the T-bill auction. 

In the secondary market, three-month and six-month T-bills changed hands at 10.00 percent and 10.25 percent, with limited activities. The 15.12.26 maturity traded at 10.75 percent. Meanwhile, the mid tenures 15.02.28, 15.07.29 and 15.09.29 were seen trading at 11.95 percent, 12.10 percent and 12.05 percent, respectively. The overall market volumes remained low. Furthermore, the Central Bank has announced a Treasury bill issuance totalling Rs.142.5 billion through an auction scheduled for October 2, 2024, out of the total auction, Rs.65.0 billion is to be raised from the 91-day maturity, Rs.67.5 billion is expected to be raised from the 182-day maturity while Rs.10.0 billion is to be raised from the 364-day maturity. Meanwhile, inflation, as measured by the CCPI, further decelerated to -0.5 percent in September 2024, from 0.5 percent in August 2024 driven by lower food and non-food inflation. Food inflation declined to -0.3 percent, while non-food inflation dropped to -0.5 percent.

Similarly, core inflation also slightly lowered to 3.3 percent in September 2024, compared to 3.6 percent in August 2024. On the external side, the Sri Lankan rupee further appreciated against the greenback closing below Rs.300.0 mark at Rs.299.4. Meanwhile, overnight liquidity recorded at Rs.88.65 billion while the Central Bank holdings remained unchanged at Rs.2,515.6 billion.