US tariff pause propels Colombo stock market

• Value of CSE soars by Rs. 221 b with ASPI rising by 4.7% and S&P SL20 by 6.7% on Rs. 7 b turnover 

The 90-day suspension of the new high reciprocal tariff by the United States propelled the Colombo stock market boosting its value by over Rs. 200 billion as investors reverted to buying mode.

The benchmark ASPI gained by 4.74% or over 700 points and the active S&P SL20 by 6.7%. Turnover was Rs. 7 billion involving 212.2 million shares. Turnover was dominated by Sampath Bank (Rs. 1.1 billion), JKH (Rs. 952.5 million), Commercial Bank (Rs. 777 million), HNB (Rs. 649 million), and RIL Property (Rs. 164 million).

The market capitalisation at Rs. 5.549 trillion, well above Rs. 5.253 trillion on Monday when jitters over the new tariff regime in the US, saw over Rs. 227 billion in value wiped off at the CSE and by nearly Rs. 500 billion since 2 April. However, the ASPI and S&P SL20 still remains negative Year to Date at 2.28% and 4.5% respectively. First Capital said the bourse bounced back from Wednesday’s dip with a sharp surge during the first 10 minutes of trading, followed by slight volatility during the rest of the day.

 The announcement regarding a 90-day pause on the US tariffs resulted in global markets gaining positive traction, followed by the CSE. 

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Positive contributors to the index far outweighed negative ones, with COMB, HNB, SAMP, JKH and LOLC leading the gains. Both HNW and retail investors remained active in today’s trading session contributing to increased levels of turnover. Strong buying interest was noted among the Banking sector and blue-chip counters amidst active participation. The turnover marked a significant 190.9% increase from the monthly average of Rs. 2.4 billion, mainly due to HNW participation. The Banking sector was the most significant contributor to the overall turnover with a 43% share, followed by the Capital Goods sector at 22% and the Consumer Durables sector at 6%. Foreign investors remained net buyers, with a net inflow of Rs. 122.3 million.

Asia Securities said indices picked up primarily due to price gains in banking sector stocks such as HNBN (+9.5%), COMBN (+9.4%), DFCC (+9.0%), SAMP (+8.4%), and NTBN (+8.1%). Moreover, investors showed increased interest in export counter stocks like MGT (+15.7%), TJL (+8.7%), and DIPD (+8.6%), along with property sector stocks such as RIL (+7.4%) and PLR (+7.3%) during the session. COMBN (+67 points), HNBN (+67 points), and SAMP (+59 points) came in as the major index movers for the day. The breadth of the market was positive, with 206 price gainers and 31 decliners.

NDB Securities said high net worth and institutional investor participation was noted in John Keells Holdings, Sampath Bank and Commercial Bank. Mixed interest was observed in Hatton National Bank, RIL Property and Browns Investments whilst retail interest was noted in EML Consultants, Hatton Plantations and SMB Leasing nonvoting. 

The Banking sector was the top contributor to the market turnover (due to Sampath Bank, Commercial Bank and Hatton National Bank) whilst the sector index gained 8.46%. The share price of Sampath Bank increased by Rs. 8.75 to Rs. 112.75. The share price of Commercial Bank moved up by Rs. 12 to Rs. 139.75. The share price of Hatton National Bank recorded a gain of Rs. 26.25 to Rs. 301.50.

The Capital Goods sector was the second highest contributor to the market turnover (due to John Keells Holdings) whilst the sector index increased by 4.33%. The share price of John Keells Holdings gained 90 cents to Rs. 20.10.

RIL Property was also included amongst the top turnover contributors with its share price gaining Rs. 1.10 to Rs. 16.