CSE decline continues as geopolitical tensions intensify

By Almas Equities Research 

The Colombo Stock Exchange (CSE) ended the day on a negative note, marking its second consecutive session of decline, as investor sentiment remained weighed down by escalating geopolitical tensions in the Middle East.

In early trading, the S&P SL20 index plunged by 157.88 points, or 3.0%, nearing the 5% market circuit breaker threshold. However, renewed buying interest from value investors helped the index recover over 120 points during the session, ultimately closing with only a marginal decline.

The All Share Price Index (ASPI) dropped by 66.89 points, or 0.38%, to close at 17,360.19. Similarly, the S&P SL20 Index fell by 36.38 points, or 0.70%, ending the session at 5,155.48.

Total market turnover amounted to LKR 3.15 billion, with 149.49 million shares traded. Market breadth reflected a negative sentiment, with 81 gainers and 124 losers contributing to the overall movement of the ASPI.

Citizens Development Business Finance  PLC (CDB.N) emerged as the top contributor to the ASPI, adding 5.06 points, while Hatton National Bank PLC (HNB.N) was the largest detractor, subtracting 13.93 points. The Diversified Financial sector led sectoral turnover with LKR 0.659 billion, accounting for nearly 21% of total market turnover.

Crossing transactions were involved today trading session, contributing approximately LKR 192.751 million roughly 6% of the day’s turnover. The largest crossings were recorded in shares of  Citizens Development Business Finance  PLC (CDB.N) totaling LKR 110.4 million with 345,000 shares traded.

In the macroeconomic front, Sri Lanka’s GDP grew by 4.8 percent in the first quarter of 2025, supported by exchange rate stability and lower interest rates, despite a 0.7 percent contraction in agriculture. Industry expanded 9.7 percent, with manufacturing up 9.6 percent and construction rising 10.7 percent. The services sector grew 2.9 percent, led by financial services (14.6%) and hotels and restaurants (14.0%).