Foreigners continue Sri Lanka bond exit, stocks flat for the week

August 12, 2018 (LBO) – As emerging markets around the world remained volatile, foreigners continued to sell out of Sri Lanka government bonds.

For the week, foreigners pulled another Rs2.5bn out of the local bond markets.  Year to date net foreign selling of Sri Lankan bonds has gone up to Rs39bn (US$244mn).

Image courtesy of Sanjeeva Dayarathne

Despite the significant foreign selling, Sri Lankan bond markets have remained stable amid global fixed income and currency instability, particularly in emerging markets.

The major stock market indices finished the week relatively unchanged, with turnover picking up from the dismal levels of the last few weeks.  Turnover for the week was Rs4.3bn (US$27mn).  This was almost triple the the levels seen the the previous week.

Foreign selling of stocks on the week was negligible at approximately US$1mn.

Year to date for 2018 the ASPI is down 3.6%, while the S&P SL 20 is down 9.7%.