Sri Lankan shares are set to open up next week afresh after ending a record-breaking month of July, stock market analysts said. The improvement of the external sector performance, local exports, lower interest rates and decrease of imports created some positive investment sentiment, they pointed out.
The retail market participation in stock trading has been improved significantly during the month of July, analysts said. Sri Lanka’s All Share Price Index (ASPI) has increased by 620 points for the month of July 2019 taking the ASPI from 5372.28 points to just under 6,000 points, closing on a 6 month high.
Finance Minister Mangala Samaraweera said that growth during this period amounted to 11.6% outperforming all major global stock indices.
Sri Lanka’s S&P20 Index has performed particularly well during this period growing 22% in the month, taking the index from 2,450 points to 3,051 points.
The market has responded to the improvement in macroeconomic stability as inflation declined to 2.1% in June, interest rates (1 year TB) declined by over 250 basis points this year.
Tourism and consumption is recovering quickly after Easter Sunday attacks, and the Rupee has appreciated 3.7% this year as the trade deficit has declined rapidly. The return of the EPF to the equity market, under prudent governance structures, is another boost to the equity market, stock market analysts said.