CSE extends losses as geopolitical risks and tariff concerns weigh on sentiment

By Almas Equities Research

The Colombo Stock Exchange (CSE) extended its downward trajectory on Thursday, with both benchmark indices recording sharp losses as investor sentiment remained under pressure from escalating tensions in the Middle East and growing concerns over the United States’ proposed tariff measures on foreign exporters.

The heightened geopolitical uncertainty and fears of potential disruptions to global trade continued to fuel risk aversion among investors, resulting in broad-based selling across the market. While overall sentiment remained weak, selective buying interest was observed in a handful of fundamentally strong counters, suggesting that value investors continued to capitalize on attractive valuations despite the prevailing uncertainty.

The All Share Price Index (ASPI) declined by 250.79 points, or 1.14%, to close at 21,760.31, while the S&P SL20 Index fell by 66.10 points, or 1.08%, to end the session at 6,031.73.

Market turnover improved to LKR 2.78 billion, with total share volume reaching 123.16 million shares, reflecting increased activity amid the market selloff.

The Capital Goods sector emerged as the largest contributor to market turnover, generating LKR 0.51 billion from 11.86 million shares traded. DOCK.N dominated sector activity, recording a turnover of LKR 0.96 billion with 0.76 million shares changing hands, highlighting continued investor interest in selected counters despite the broader market decline.

Crossing transactions accounted for LKR 0.78 billion, representing 28% of total market turnover. The largest crossing was recorded in LLUB.N, amounting to LKR 0.29 billion involving 1.50 million shares traded.

Market breadth weakened significantly, with only 30 gainers against 186 decliners, underscoring the extent of the selling pressure witnessed across the market.

Among the positive contributors to the ASPI, AHPL.N led gains with a contribution of 1.38 points, followed by COOP.N, CARE.N, EBCR.N, and GREG.N. However, these gains were overshadowed by substantial declines in several heavyweight counters. DIAL.N emerged as the largest negative contributor, dragging the index down by 26.88 points, while COMB.N, MELS.N, HNB.N, and CARG.N also exerted considerable downward pressure.

Among notable trades, DIAL.N attracted significant market activity, recording a turnover of LKR 0.13 billion with 3.24 million shares traded. Despite the elevated trading interest, the counter closed 3.97% lower, reflecting the broader weakness and cautious investor sentiment that prevailed throughout the session.