The bourse today suffered its lowest turnover and share volume (SV) not seen since the eve of President Gotabaya Rajapaksa being booted out of office 269 days ago by people’s power on Friday 8 July 2022 due to a mix of uncertainty and fears that tomorrow’s Monetary Board meeting would see a rate hike to tame high, double digit inflation.
A high interest rate regime is inimical to the bourse as investors would prefer to invest in the former for better returns at the expense of the latter. Consequently the bourse made a Rs 569.96 million turnover on a 26.75 million SV at today’s trading. Prior to today, the last time the bourse registered lower turnover and SV levels was on 8 July 2022 with figures of Rs 385.87 million and 22.94 million, respectively.
Subsequently the benchmark ASPI fell by 0.69 per cent to 9,236.93 points and the more sensitive S&P SL 20 Index by 0.24 per cent to 2,676.48 points today. Nevertheless, the bourse ‘enjoyed a pyrrhic net foreign inflow (NFI) of Rs 5.50 million today, thereby increasing NFIs in the calendar year to date to Rs 663.15 million.