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Stock market indices plunge amid virus fears


6 October 2020 09:27 am - 0     - {{hitsCtrl.values.hits}}


  • Discovery of new COVID-19 cluster puts a damper on investor sentiment 
  • ASPI records highest single-day drop falling 463 points
  • SL S&P20 index loses 178.24 points or 7.26%

The indices at the Colombo Stock Exchange plunged yesterday with the discovery of a new COVID-19 cluster in Divulapitiya, in the Gampaha district, triggering fears that the virus, which was earlier thought to be well under control, has reached community level.

With the news report of 69 new COIVD-19 positive cases emerging, the market went into a frenzy and the main All Share Price Index (ASPI) fell over 5 percent, triggering the circuit breakers at 11.07 a.m. After the 30-minute cooling off period, the market began trading again at 11.37 a.m.

However, that session lasted less than 15 minutes, when the circuit breakers tripped again at 11.43 a.m., with the ASPI falling further 2.5 percent, which again halted the trading for 30 minutes, till 12.13 p.m.

Yesterday, the ASPI recorded the highest drop in points in a single day, as the index fell 462.99 points. The previous highest was 303 points on March 20, a day before the countrywide curfews were announced, to control the spread of COVID-19. The ASPI ended 7.65 percent, down at 5,587.18, while the more liquid S&P SL20 closed 7.26 percent, down at 2,276.19, as the index lost 178.24 points.

Undeterred by the two market halts, yesterday’s market turnover however topped Rs.3.8 billion.

“Due to the discovery of a new cluster of COVID-19 cases after two and a half months, both the ASPI and S&P SL20 closed in red, while the ASPI recorded its single largest drop in index points during the day,” NDB Securities said. 

The drop in the ASPI was mainly attributable to the price losses in counters such as Carson Cumberbatch, Distilleries and Bukit Darah. Foreign investors meanwhile, recorded a net outflow of Rs.142.76 million, compared to a net outflow of Rs.662.3 million recorded on Friday.

High-net-worth and institutional investor participation was noted in John Keells Holdings and DFCC Bank. 

Mixed interest was observed in Expolanka Holdings, Tokyo Cement Company voting and non-voting, whilst retail interest was noted in Access Engineering, Royal Ceramics and RIL Property. 


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