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View all(53)📉 LKR Depreciates: Dollar Selling Rate Crosses Rs. 324
The Sri Lankan Rupee continued its downward trend against the US Dollar today (May 06), hitting its lowest levels in over two years as market pressure mounts on the local currency. • Exchange Rate Movements: The selling rate rose to Rs. 324.03, marking the first time it has exceeded the Rs. 324 threshold since January 2024. The buying rate stood at Rs. 316.40, maintaining its position above the Rs. 316 mark reached earlier this week. • Market Benchmarks: The SPOT exchange rate was recorded at Rs. 319.78 today, reflecting ongoing volatility after peaking at Rs. 319.93 on Monday. • Year-to-Date Performance: According to the Central Bank of Sri Lanka, the rupee has depreciated by 2.9% against the US Dollar as of April 30, 2026. • Economic Context: This shift impacts key sectors such as import-reliant manufacturing and energy, potentially increasing the cost of raw materials. Conversely, it may provide a marginal competitive edge for apparel & textiles and tea exports in terms of rupee-denominated earnings.
Asia Markets Hit Record Highs Amid AI Surge and Middle East De-escalation 📈
• Global Market Impact: Asian shares outside Japan jumped 2.3% to record highs, led by a 5.1% surge in South Korea's Kospi. Wall Street also hit fresh peaks with the S&P 500 rising 0.8%, driven by a massive rotation into tech and semiconductors. • Energy & Commodities: Brent crude fell 1.2% to US$ 108.51 per barrel following news of a pause in the Strait of Hormuz blockade and progress toward a U.S.-Iran agreement. Gold rose 1.2% to US$ 4,609.59. • Tech & AI Sector: South Korea’s Samsung Electronics surged 12%, surpassing a US$ 1 Tn market value. Demand for AI infrastructure continues to drive record earnings for Asian providers of hardware and industrial materials. • Currency & Forex: The U.S. Dollar index dipped 0.1% to 98.236 as risk appetite improved. The Australian dollar hit its highest level since 2022, while the Euro and Sterling both gained approximately 0.3%. • Economic Context: Easing energy tensions and heavy capex spend in the ICT/tech hardware ecosystem are creating significant value across Asian supply chains, providing a favorable tailwind for regional trade and materials exports.
Gold Rebounds to $4,543 Amid Inflation & Oil Price Pressures 📈
Gold prices stabilized on Wednesday, recovering slightly after a sharp 2% drop earlier in the week. While the precious metal regained some ground, gains remain restricted by rising crude oil prices and shifting US interest rate expectations. • Market Performance: Spot gold rose 0.5% to US$ 4,543.33 per ounce, while US gold futures for June delivery edged up 0.4% to US$ 4,553.10. • Economic Drivers: A rebound in crude oil has reignited global inflation fears, pushing US Treasury yields and the dollar higher. This environment typically reduces the appeal of non-interest-bearing assets like gold. • Sri Lankan Context: As a net importer of fuel and gold, higher global oil prices can pressure the trade balance, while gold price volatility impacts the jewelry sector and the value of gold-backed lending (pawning) within the banking and finance industry. • Outlook: Market sentiment remains cautious as investors weigh gold's role as an inflation hedge against the rising opportunity cost of holding the metal in a high-interest-rate environment. _Note: Based on spot market data as of May 6, 2026._
📈 Secondary Bond Yields Edge Up Amid Global Tensions
Sri Lanka’s secondary bond market saw yields rise for a second consecutive session as Middle Eastern tensions and high crude oil prices dampened investor sentiment. • Market Sentiment & Activity: Participants adopted a "wait-and-see" approach due to global uncertainty. Despite subdued activity, healthy transaction volumes were recorded via block trades driven by selling pressure. Total secondary market volume for May 4 stood at Rs. 6.79 Bn. • Key Bond Yield Highlights: • 2026 Maturities: 01.08.26 traded at 8.32%. • 2028 Maturities: Yields ranged between 9.75% and 9.85%. • 2030-2031 Maturities: Rates fluctuated between 10.20% and 10.27%. • Long-term (2033-2034): Yields climbed to the 11.00% - 11.29% range. • Treasury Bill Auction (May 6): A total of Rs. 100 Bn is on offer (Rs. 45 Bn for 91-day, Rs. 25 Bn for 182-day, and Rs. 30 Bn for 364-day tenors). This is notably lower than the estimated maturity of Rs. 126 Bn. • Liquidity & Forex: • Market liquidity surplus rose to Rs. 246.30 Bn. • The USD/LKR spot exchange rate closed slightly weaker at Rs. 319.90/320.40, compared to the previous day’s Rs. 319.60/320.00. • Daily forex traded volume reached US$ 55.30 Mn. _Note: Based on secondary market data and CBSL auction schedules._
CSE Ends in Red Amid Middle East Tensions 📉
The Colombo Bourse closed lower yesterday as escalating geopolitical conflict dampened investor sentiment, despite ongoing peace talk optimism. • Market Performance: The ASPI dropped 0.49% (110.70 points) to 22,584.30, while the S&P SL20 declined 0.50% to 6,213.24. • Liquidity: Market turnover stood at Rs. 2.1 Bn with 98 million shares traded. • Investor Activity: Foreign investors were net sellers with an outflow of Rs. 42 Mn. Participation from High Net Worth (HNW) and retail segments remained subdued. • Sector Highlights: - Banking: Contributed 17% to turnover; Commercial Bank led activity but saw its share price dip to Rs. 209.75. - Diversified Financials & Capital Goods: Combined for 32% of turnover. LB Finance closed flat at Rs. 155. - ICT/Tech: Digital Mobility Solutions Lanka defied the trend, gaining Rs. 2 to close at Rs. 155. • Key Laggards: CINS, CTHR, HAYL, SAMP, and HHL were the primary negative contributors to the indices. _Summary based on daily market provisional data._
📈 Secondary Bond Yields Edge Up Amid Geopolitical Tensions
The secondary bond market saw a marginal increase in yields as ongoing Middle East conflicts and rising crude oil prices dampened investor sentiment. Despite initial optimism from diplomatic talks, reports of an attack on a US warship led to a defensive, "wait-and-see" approach by market participants. • Market Yields & Activity Transaction volumes remained healthy, supported by several block trades. 15.12.26 maturity: Traded between 8.55% – 8.65%. 2030 maturities: 01.03.30 at 10.05% – 10.10%; 01.07.30 at 10.20% – 10.25%. Long-term maturities: 01.06.33 at 11.05% and 15.06.35 at 11.26%. Total bond/bill volume (April 30): Rs. 17.24 Bn. • Liquidity & Money Market Net liquidity surplus: Recorded at Rs. 226.55 Bn. Standing Deposit Facility (SDFR): Rs. 176.10 Bn deposited at 7.25%. CBSL absorption: Drained Rs. 50.45 Bn via overnight repo auction at a weighted average rate of 7.71%. • Forex Market The USD/LKR spot rate closed at Rs. 319.60/320.00, relatively stable compared to the previous day’s "spot next" close of Rs. 319.75/320.00. Total USD/LKR traded volume (April 30): US$ 97.99 Mn. _Data based on provisional reports from Wealth Trust Securities and CBSL._
📈 CSE Starts May on Positive Note with 0.65% Gain
The Colombo Stock Exchange (CSE) opened the month in green, driven by global optimism regarding US-Iran negotiations. While indices rose, the market saw significant foreign exits. • Overall Performance: The ASPI gained 145.47 points (+0.65%) to close at 22,695.00, while the S&P SL20 rose 37.08 points (+0.6%) to 6,244.64. Market turnover reached Rs. 4.8 Bn with 90.2 million shares traded. • Sector Highlights: • Food, Beverage & Tobacco: Led market turnover with a 56% share, gaining 1.30% as a sector. • Banking & Capital Goods: Collectively contributed 23% to turnover; the Banking index rose 0.70%. • Key Stock Movements: • Top contributors to turnover included NDB, DIAL, MELS, DOCK, and HARI. • CTC dominated turnover at Rs. 2.4 Bn (49.7% of total) despite a price dip to Rs. 1,800. • Significant gains were noted in HDFC (+Rs. 10.90) and Asiri Hospital Holdings (+Rs. 2.90). • Investor Sentiment: High Net Worth (HNW) participation was elevated, with crossings accounting for 57.8% of turnover. Retail interest remained subdued. • Foreign Inflows/Outflows: Foreign investors were net sellers with a daily outflow of Rs. 2.45 Bn, largely due to CTC. This brings the Year-to-Date (YTD) net foreign selling to Rs. 27.6 Bn.
📈 Global Oil Surges 3% Amid Strait of Hormuz Tensions
Global oil prices jumped over 3% on Monday following reports of military escalation between Iran and the U.S. in the strategic Strait of Hormuz, a critical chokepoint for global energy supplies. • Price Movements: Brent Crude futures rose by US$ 3.64 (+3.4%) to US$ 111.81 per barrel. U.S. WTI crude climbed US$ 3.40 (+3.3%) to US$ 105.34 per barrel. • Conflict Context: Prices spiked after Iran claimed to have struck a U.S. warship; however, U.S. Central Command has officially denied these reports. Tensions remain high as Iran warned of a "harsh response" to any U.S. presence in the waterway. • Supply & Logistics: • Shipping remains constrained near Fujairah, with reports of a tanker hit by unknown projectiles. • OPEC+ announced an output target increase of 188,000 bpd for June, though analysts suggest these gains may only exist "on paper" due to ongoing regional blockades. • Impact on Sri Lanka: As a net importer of fuel and energy, sustained prices above US$ 100/barrel place significant pressure on Sri Lanka's foreign exchange reserves and domestic inflation. Increased shipping risks in the Gulf may also affect the logistics and freight costs for vital imports and exports. _Data based on reports from Reuters and Fars as of May 4, 2026._
📈 Colombo Bourse Surges as Turnover Hits Rs. 4.8 Bn
The Colombo Stock Exchange (CSE) maintained a strong upward trajectory today, marked by significant index gains and robust trading activity driven by foreign interest. • Overall Market Performance: The All Share Price Index (ASPI) rose by 145.47 points (+0.65%) to close at 22,695. The S&P SL20 index followed suit, gaining 37.08 points to settle at 6,244.64. • Turnover Highlights: Daily turnover reached a substantial Rs. 4.8 Bn. A major driver was a strategic "crossing" in Ceylon Tobacco Company (CTC), which accounted for Rs. 2.38 Bn—nearly half of the day's total turnover. • Key Transaction Details: The CTC deal involved the trade of 1,341,170 shares at a price of Rs. 1,780.00 per share. Market sources report this was a high-value transaction executed between two foreign entities, signaling continued international interest in blue-chip Sri Lankan stocks. • Sector Impact: The heavy volume in the manufacturing and consumer goods sector (via CTC) provided the necessary liquidity to boost market sentiment, reflecting a stable outlook for high-dividend-yielding stocks.
📈 Secondary Bond Market Stabilizes Amid Improving Fiscal Fundamentals
Sri Lanka’s secondary bond market entered a consolidation phase last week, with yields holding steady as strong domestic fiscal performance offset geopolitical risks. • Market Sentiment & Liquidity: Sustained surplus liquidity in the money market crossed the Rs. 200 Bn mark, ending the week at Rs. 218.70 Bn. This increased liquidity helped maintain stability in short-end rates despite external pressures from Middle East tensions and crude oil prices. • Treasury Bill Auction Highlights: The weekly T-Bill auction saw a correction in the yield curve as the 91-day Bill yield dropped by 7 basis points (bps) to 8.20%. 182-day: 8.25% (+2 bps) 364-day: 8.52% (Unchanged) The auction was slightly undersubscribed, raising Rs. 136.94 Bn against an offered Rs. 140 Bn. • Key Yield Movements: Short-term: 2026 maturities traded between 8.15% - 8.40%. Medium-term: 2030-2031 tenors held between 10.18% - 10.25%. Long-term: 2034-2037 maturities traded between 11.15% - 11.25%. • Economic Indicators: Inflation: April CCPI accelerated to +5.40% YoY (from +2.20% in March), remaining within the CBSL target band. Foreign Holdings: Stabilized at Rs. 144.20 Bn after two weeks of inflows. Forex: The LKR depreciated slightly against the US Dollar, closing at Rs. 319.75/320.00. • Fiscal Note: Strong performance in January 2026 saw a sharp expansion in the primary surplus and the near-elimination of the overall budget deficit, providing a robust anchor for the financial services and banking sectors.
📈 Global Oil Prices Surge Past US$ 120 Amid Strait of Hormuz Tensions
Global energy markets hit a four-year peak as Brent crude briefly touched US$ 122 per barrel, the highest level since 2022. The price spike follows a 12-day steady climb triggered by the ongoing blockade of Iranian ports and the subsequent disruption of the Strait of Hormuz. • Price Dynamics: Brent crude surpassed US$ 120, a significant rebound from the US$ 90 recorded on 17 April following the brief Israel-Lebanon ceasefire. • Market Sentiment: High-level meetings between the US President and energy executives, including Chevron, suggest a prolonged disruption to global shipping and energy supply chains. • Geopolitical Impact: The US move to extend the blockade on Iran’s economy has led to Iranian threats to continue disrupting traffic through the Strait, a critical artery for global oil futures. • Economic Outlook: The World Bank forecasts a 24% surge in energy prices for 2026 if disruptions persist, potentially matching levels seen during the 2022 Ukraine crisis. • Regional Context: For Sri Lanka, this surge in global energy costs typically exerts pressure on foreign exchange reserves and increases the cost of thermal power generation and transportation. _Source: Based on provisional market data as of May 2026._
Brent Crude Jumps to $115 Amid Extended Iran Blockade 📈
Global oil benchmarks surged on Wednesday following reports of an "extended" U.S. blockade on Iranian ports, directly impacting global energy costs and Sri Lanka's import bills. • Market Impact: Brent crude rose to approximately US$ 115 per barrel, up from Tuesday’s close of US$ 110. Prices remain significantly higher than pre-conflict levels, despite a brief dip to US$ 90 earlier this month. • Supply Chain Risks: The Strait of Hormuz, which handles roughly 20% of global oil and LNG supply, remains effectively closed. Iran has threatened to target vessels, while the U.S. is actively intercepting ships to squeeze the Iranian economy. • Macro-Economic Outlook: The World Bank warns of a 24% surge in energy prices for 2026 if disruptions persist. This poses a significant risk to Sri Lanka's foreign exchange reserves and fuel prices, potentially impacting the transportation and manufacturing sectors. • Financial Markets: European stocks (FTSE 100, Stoxx) fell by 0.4% to 0.76% as investors reacted to the escalation. Conversely, Asian markets showed a slight recovery, though analysts warn that a quick reopening of the Strait is unlikely. _Data based on reports from the Wall Street Journal and BBC Verify as of April 29, 2026._