The Colombo Stock Exchange closed sharply lower on Wednesday as concern over the rupee’s continued slide against the US dollar kept sellers in control throughout the session.
The All Share Price Index fell 1.98 percent, or 441.87 points, to close at 21,856. The S&P SL20 index, which tracks the largest and most liquid counters, dropped 1.57 percent, or 96.38 points, to end at 6,052.39.
Analysts said the depreciation of the rupee was the primary factor weighing on sentiment. The local currency has been under sustained pressure this week, with the selling rate touching Rs. 346.50 — the highest level in the current cycle — as the US dollar continued to strengthen against regional currencies.
Wednesday’s decline follows a session on Tuesday where the ASPI had closed higher at 22,298. The reversal underscores the sensitivity of the market to the foreign exchange situation, particularly given the volume of dollar-denominated costs carried by listed companies in sectors such as manufacturing, energy, and imports.
The government has sought to contain public concern about the rupee’s fall, with the Central Bank Governor noting earlier this week that Sri Lanka’s 4.8 percent depreciation against the dollar is smaller than comparable moves in India, Nepal, and Indonesia.
