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View all(69)🚨 Oil Prices Surge Over 3% Following US-Iran Escalation
Global oil benchmarks jumped significantly following a brief drop in the previous session, triggered by renewed military hostilities between the US and Iran. • Market Impact: Brent crude futures for July surged by US$ 3.51 (3.72%) to US$ 97.8 a barrel, while the more active August contract gained US$ 3.35 (3.63%) to reach US$ 95.6. US West Texas Intermediate (WTI) futures rose by US$ 3.31 (3.73%) to US$ 91.99. • Geopolitical Drivers: The surge follows a retaliatory strike by Iran's Revolutionary Guards on a US airbase. This came after a US military strike near Bandar Abbas airport targeting an Iranian military site deemed a threat to US forces and commercial shipping in the strategic Strait of Hormuz. • Supply Constraints: The escalation disrupts prior market optimism regarding a potential deal to reopen the Strait of Hormuz. Analysts note that global oil supply remains heavily constrained with unresolved geopolitical sticking points. • Inventory Data: Supporting the tight supply outlook, provisional American Petroleum Institute (API) data showed US crude oil stockpiles fell by 2.8 million barrels last week, marking their sixth consecutive week of declines. _Context for Sri Lanka:_ As a net oil-importing nation, sharp increases in global energy commodities typically exert pressure on Sri Lanka's foreign exchange reserves, import bills, and domestic retail fuel pricing structures.
💵 Sri Lankan Rupee Edges Lower Against US Dollar Amid Market Volatility
• Exchange Rate Movements: The Sri Lankan rupee depreciated against the US Dollar on Wednesday. The indicative telegraphic transfer LKR/USD buy/sell rate edged higher to Rs. 320.40/Rs. 330.81, compared to Rs. 318.32/Rs. 328.69 on Tuesday. However, the currency remains stronger than Monday's rates and last Thursday's peak of Rs. 342.63/Rs. 354.03. • Interbank Market: The buy/sell LKR/USD interbank spot contracts closed higher at Rs. 328.50/Rs. 332.00 yesterday, up from Tuesday’s Rs. 322.00/Rs. 325.00, but lower than last week's weakest level of Rs. 331/Rs. 348. • Central Bank Intervention: To calm a panicking market, the Central Bank of Sri Lanka (CBSL) utilized moral suasion rather than excessively selling down foreign reserves. The CBSL capped trades at Rs. 330 for certain banks and signaled potential new measures to compel exporters to convert dollar earnings sooner. • Economic Context: CBSL Governor Dr. Nandalal Weerasinghe stated the bank is prepared to use moral suasion to contain excessive exchange rate volatility driven by global supply disruptions from the Middle East war.
📈 Colombo Stocks Edge Up Despite Rate Hike Cautiousness
The Colombo stock market recovered to close in the green yesterday, showing resilience despite subdued investor sentiment following the Central Bank of Sri Lanka's (CBSL) recent 100-basis-point policy rate hike. • Market Performance & Figures: • ASPI rose by 0.11% (+24.09 points) to close at 22,199.23. • S&P SL20 gained 0.21% (+13.08 points) to end at 6,131.34. • Market turnover reached over Rs. 1.86 Bn with 61.8 Mn shares traded. • Market Price-to-Earnings (P/E) ratio stood at 11.43. • Sector & Stock Breakdowns: • Food, Beverage & Tobacco was the top turnover contributor at 19%. • Materials and Capital Goods jointly brought in 30% of turnover. • Key positive index drivers included DIAL, CCS, BREW, CARS, and NDB. • Crossings accounted for 14% of turnover, led by CICN (Rs. 153.8 Mn), LMF (Rs. 46 Mn), and JKH (Rs. 40.2 Mn). • Investor Activity: • Retail and high-net-worth investor participation remained below average. • Foreign investors recording a minor net inflow of Rs. 0.71 Mn. • Net foreign buying peaked in VLL (Rs. 75.4 Mn), while net foreign selling was highest in AAIC (Rs. 68.4 Mn).
📊 Global Markets Rise Amid US-Iran Truce Uncertainty & Central Bank Moves
• Market Movements: Asian shares broadly advanced, with MSCI’s Asia-Pacific index (ex-Japan) up 1.2%. Japan’s Nikkei surged 1.8% to hit a record high, tracking Wall Street's AI-driven optimism. • Energy & Commodities: Energy markets face vulnerability as Brent crude traded near US$ 100 per barrel (down 0.52% after a prior 4% surge) and U.S. crude sat at US$ 93.05 per barrel. Tensions remain high following ceasefire violation allegations. Spot gold ticked up 0.36% to US$ 4,522.14 an ounce, while copper rose 0.46% to US$ 13,686.50 per metric ton. • Currency & Central Banks: The U.S. dollar index held steady at 99.09. Central banks face inflation pressure from ongoing supply shocks; the Reserve Bank of New Zealand is expected to hold its key rate at 2.25%, while ECB members lean toward a June interest rate hike despite ongoing peace talks. • Crypto Updates: Bitcoin softened slightly by 0.18% to US$ 75,883.90, while Ether remained flat at US$ 2,075.39. _Note: Based on current global market data; direct impacts on Sri Lanka's import costs (especially oil) and broader ICT/BPM or export sentiment will depend on final U.S.-Iran negotiation outcomes._
📈 CSE Ends Lower Post-Policy Rate Hike & Middle East Tensions
The Colombo Stock Exchange (CSE) closed in the red yesterday amid heavy foreign selling. Investor sentiment was dampened by the Central Bank's recent 100bps overnight policy rate hike and escalating Middle East tensions following a US strike on Iranian missile facilities. • Market Indices: The All Share Price Index (ASPI) dropped 0.85% (-189.63 points) to close at 22,175.14, while the S&P SL20 fell 0.98% (-60.84 points) to 6,118.26. The decline was broad-based, with 176 counters closing lower against 53 gainers. • Turnover & Volume: Total market turnover stood at Rs. 4.93 Bn, with over 94.3 million shares traded. Subdued retail investor participation was observed. • Foreign & Institutional Activity: Foreign investors were heavy net sellers, resulting in a major net outflow of over Rs. 3.00 Bn. High-Net-Worth (HNW) participation was high, with crossings accounting for 66.4% of the total market turnover. • Sector Performance: The insurance sector dominated market activity, leading daily turnover with a massive 65% share. This was heavily driven by a single crossing in AAIC worth Rs. 3.10 Bn. The banking and diversified financials sectors collectively contributed 15% to the daily turnover. • Top Laggards: The top negative contributors dragging down the ASPI included major players in the banking and diversified conglomerates sectors, specifically SAMP, HAYL, JKH, HNB, and NDB.
📈 Global Energy: Brent Crude Rises 1.5% Amid US Strikes in Iran
Global oil markets remained highly volatile as targeted geopolitical escalations directly impact global energy supply chains—a critical factor for Sri Lanka's fuel import costs and macroeconomic stability. • Market Figures: Brent crude futures climbed 1.5% ($1.40) to US$ 97.56 a barrel in early Asian trade on Tuesday, recovering slightly from a 7% drop in the previous session. U.S. West Texas Intermediate (WTI) crude edged up to US$ 91.25 a barrel. • Geopolitical Drivers: The U.S. Central Command confirmed defensive military strikes on Iranian boats and missile launch sites in southern Iran following reported explosions near the shipping & logistics chokepoint of Bandar Abbas along the Strait of Hormuz. • Supply Chain Impact: Tehran’s blockade has choked off roughly 20% of global oil and gas flows over the last three months, driving global energy prices up by 50% or more. • Diplomatic Outlook: Despite the strikes, negotiators in Doha reported progress on a memorandum of understanding for a 60-day window to finalize a peace deal. The proposed agreement includes clearing mines from the strait within 30 days to restore free, safe navigation and halt transit fee collections. • Regional Shipments: Early signs of easing friction emerged as tracking data showed four stranded tankers—including three LNG vessels and an Iraqi crude supertanker—successfully departed the strait heading toward Pakistan, China, and India.
📈 Colombo Bourse Rallies as ASPI Climbs Over 400 Points (25 May 2026)
The Colombo Stock Exchange (CSE) witnessed a strong rally driven by broad-based buying interest and heavy domestic participation. • Market Indices & Capitalization Benchmark ASPI surged by 435.13 points (+1.98%) to close at 22,364.77. S&P SL20 Index gained 118.08 points (+1.95%) to settle at 6,179.10. Market capitalization rose to Rs. 8.11 trillion, up from Rs. 7.95 trillion in the previous session. • Turnover & Investor Participation Total market turnover stood at Rs. 2.42 billion with 106.1 million shares traded. Domestic investors dominated the session, recording Rs. 2.39 billion in purchases and Rs. 2.37 billion in sales. Foreign investors recorded a net outflow of Rs. 24.57 million (purchases of Rs. 27.09 million vs. sales of Rs. 51.67 million). • Sector & Stock Highlights Market breadth was strongly positive, with 137 companies gaining over 2%. The rally was heavily led by major blue-chip and banking sector counters. Top contributors to the ASPI gains included Dialog Axiata (+36.78 points), Commercial Bank of Ceylon (+17.50 points), John Keells Holdings (+16.04 points), Sampath Bank (+14.69 points), and Hemas Holdings (+13.97 points).
📉 Global Oil Prices Slip 6% Amid US-Iran Peace Optimism • Overall Impact: Global crude oil prices tumbled ~6% on Monday to hit two-week lows. This comes as a potential relief to energy-dependent economies like Sri Lanka, which have faced severe pressure on foreign reserves due to high import bills and West Asian geopolitical tensions.
• Price Breakdowns: • Brent crude futures dropped by US$ 5.85 (or 5.7%) to US$ 97.69 a barrel. • U.S. West Texas Intermediate (WTI) decreased by US$ 5.75 (or 6.0%) to US$ 90.85 a barrel. • Both contracts recorded their lowest levels since May 7. • Key Market Drivers: • Optimism grew after the US announced a "largely negotiated" understanding to reopen the crucial Strait of Hormuz, which previously handled 20% of global oil and LNG shipments. • Analysts remain cautious as the two sides remain at odds over critical blockades, and a return to normal flow could take months due to damaged infrastructure. • Supply Side Indicators: U.S. energy firms increased oil and gas rigs for the fifth consecutive week to 558 rigs (up by 7) to capitalize on recent high prices. However, the total count remains 1% lower YoY.
📈 CSE Opens Week in Green on Strong Sentiment and Appreciating LKR
The Colombo Stock Exchange (CSE) started the week with a broad-based rally, driven by a strengthening Rupee and positive global developments, including progressing US-Iran peace talks and easing oil prices. • Market Performance: The ASPI surged by 1.98% (+435.13 points) to close at 22,364.77, while the S&P SL20 rose 1.95% (+118.08 points) to 6,179.10. High-net-worth and retail participation remained somewhat subdued in a cautious market. • Turnover & Trading: Total market turnover crossed Rs. 2.4 Bn with 106.1 million shares traded. Foreign investors recorded a net outflow of Rs. 24.6 Mn. • Sector & Stock Highlights: Capital Goods led daily turnover with a 15% share, driven by Colombo Dockyard (+Rs. 5 to Rs. 137.50), with the sector index gaining 2.19%. Food, Beverage & Tobacco and Diversified Financials collectively contributed 28% to turnover. Ceylon Cold Stores gained 2.41% (+Rs. 5.25 to Rs. 130.25). Apparel & Textiles saw retail interest via Teejay Lanka, which closed up at Rs. 31.60. Top overall positive index contributors included DIAL (+Rs. 2.60 to Rs. 39.90), COMB, JKH, SAMP, and HHL.
📈 Secondary Bond Market Surges Ahead of Key Policy & Auction Decisions
The Sri Lankan secondary bond market kicked off the week with a bullish rally, driving yields down considerably on robust transaction volumes. Optimism was fueled by global oil prices dipping below $ 100 on potential US-Iran peace progress, alongside a further appreciation of the Sri Lankan rupee and easing global yields. • Market Movements & Yields: • Bond yields fell significantly, with the 01.07.28 maturity dropping from an intraday high of 10.18% to 10.00%. The 01.10.32 maturity declined sharply from 11.25% to 11.00% on sizeable volumes. • Short-term maturities like 15.09.27 traded at 9.60%, while long-term tenors like 15.08.36 held at 11.45%. • Upcoming Primary Debt Auctions: • Treasury Bill Auction: Rs. 140.00 Bn is on offer today across 91-day (Rs. 65 Bn), 182-day (Rs. 45 Bn), and 364-day (Rs. 30 Bn) tenors. This follows a previously undersubscribed auction that raised only 48.03% (Rs. 67.24 Bn) of its offer, where 91-day and 182-day weighted averages rose slightly to 8.18% and 8.25%. • Treasury Bond Auction: Rs. 240.00 Bn is scheduled for May 27 across three maturities: 2030 (Rs. 90 Bn), 2033 (Rs. 70 Bn), and 2035 (Rs. 80 Bn). • Liquidity & Forex Indicators: • Money market net liquidity surplus stood at Rs. 136.99 Bn. Overnight call money and repo weighted average rates settled at 7.94% and 8.00% respectively. • The spot USD/LKR rate appreciated sharply to close at Rs. 325.50/327.00, compared to the previous close of Rs. 329.00/335.00. Total traded volume reached US$ 92.62 Mn on May 22.
📈 Dialog Axiata Overtakes JKH as Most Valuable Listed Company on CSE
• Dialog Axiata PLC has regained the top spot as the most valuable listed company on the Colombo Stock Exchange (CSE) after 11 years, overtaking long-standing dominant blue-chip John Keells Holdings (JKH). • Overall Market Status: The total market capitalization of the CSE rose by 2.04% from Friday, reaching Rs. 8.11 Trillion. • Top 5 Market Capitalization Breakdown: Dialog Axiata: Rs. 367.1 Bn (4.51% of total market cap) John Keells Holdings (JKH): Rs. 359.4 Bn (4.42% of total market cap) Ceylon Tobacco Company: Rs. 341.9 Bn (4.20% of total market cap) Commercial Bank: Rs. 320.9 Bn (3.95% of total market cap) LOLC Holdings: Rs. 268.0 Bn (3.30% of total market cap) • Remaining Top 10 Leaderboard: Distilleries Company: Rs. 261.7 Bn (3.22%) Melstacorp: Rs. 218.2 Bn (2.68%) Hayleys: Rs. 189.4 Bn (2.33%) Hatton National Bank: Rs. 185.7 Bn (2.28%) Cargills Ceylon: Rs. 177.8 Bn (2.19%) • Historical Context: While JKH has maintained the most consistency and longevity at the top of the Sri Lankan equity market for roughly four decades, telecommunications giant Dialog previously challenged the top spot following its 2005 listing. Other sectors like global logistics (Expolanka in 2021-2022) and diversified conglomerates (LOLC and Hayleys) have also briefly shifted rankings during exceptional market cycles.
📈 Volatile Week Ends with Rupee Recovery and Rising Bond Yields
Sri Lanka’s secondary bond market ended on a positive note after a predominantly bearish week driven by global crude oil volatility and Middle East tensions, which prompted a defensive stance mirroring rising global yields. • Market Sentiment & Bonds: Yields rose for four consecutive sessions due to selling pressure but partially retraced on Friday due to a late buying surge and a sharp appreciation of the Sri Lankan rupee. Yield curves moved in an inverted U-pattern, closing the week notably higher. • Maturity Movements: The 01.08.26 maturity traded between 8.25% and 8.68%. In the 2028 space, the 01.07.28 maturity peaked at 10.55% before recovering to 10.25%. Long-term 2034 and 2035 maturities traded up to highs of 11.70% and 11.50% respectively. • T-Bill Auction: The weekly T-bill auction was undersubscribed, raising only 48.03% (Rs. 67.24 Bn) of the Rs. 140 Bn on offer. Yields reversed their downward trend; the 91-day tenor rose by 5 bps to 8.18%, the 182-day tenor rose by 2 bps to 8.25%, while the 364-day tenor held steady at 8.49%. • Foreign Outflows: Government securities recorded a net foreign outflow for the third consecutive week, shedding Rs. 4.58 Bn. Total foreign holdings dropped to Rs. 133.43 Bn as of May 21. • Liquidity & Forex: Outstanding market liquidity surplus fell to Rs. 141.27 Bn (from Rs. 156.80 Bn). In the forex market, the USD/LKR spot contract exhibited high volatility, trading between Rs. 326.50 and Rs. 348.00 before recovering strongly to close at Rs. 329.00. Average daily trading volume stood at US$ 50.13 Mn.