Financial sector stocks strengthen following CBSL’s lending rate decision

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Financial sector stocks strengthen following CBSL’s lending rate decision

Postby stocks hunter » Thu Apr 12, 2018 8:03 am

by Hiran H.Senewiratne

The Central Bank announcement on increasing the lending rate by 25 Basel points, coupled with an anticipated five percent economic growth for 2018, had the effect of increasing financial sector, especially banking sector, stocks in the Colombo Stock Exchange (CSE) yesterday, stock market analysts said.

The Central Bank unexpectedly cut its key lending rate by 25 basis points on Wednesday, as policy makers sought to revitalise an economy growing at its weakest pace in 16 years and facing heightened political uncertainty, market sources said.

Therefore, stocks in most banks at the CSE were traded and appreciated in the market. Amid those developments both indices moved up, ie, the All Share Price Index moved up by 12.15 points and S and P SL20 by 4.50 points. But the turnover level stood at Rs. 553 million with two crossings. Those crossings were; Softlogic Finance 1.86 million shares crossed for Rs. 335 million, per share value Rs. 37.80 and Lion Brewery 45000 shares crossed for Rs. 23.4 million, per share value Rs. 525.

In the retail market, companies that mainly contributed to the day's turnover were; , Lion Brewery Rs 19.7 million (37,500 shares traded) and LB Finance Rs. 17.2 million (145,000 shares traded). During the day, 16.36 share volumes changed hands in 2876 transactions.

Two crossings had contributed more than 65 percent of the day's turnover. The retail market performance was rather weak due to the New Year effect and things will improve after April 20, market analysts told The Island Financial Review.

Market sentiment had improved after Prime Minister Ranil Wickremesinghe survived a no-confidence motion last week, dealers said.

"But still, the market is waiting for some more clarity on the political front. The holidays are also weighing on the trading," stock market analysts said.

Dealers expect the stock market to be tepid this week ahead of the Sinhala-Tamil New Year on April 14.

http://www.island.lk/index.php?page_cat ... tle=183043

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