Banking Strength Fails to Reverse CSE Slide as ASPI Falls 42 Points
COLOMBO, October 3, 2026 — Strength in banking and financial counters failed to offset broader selling pressure at the Colombo Stock Exchange (CSE) yesterday, with the market closing lower amid weak investor sentiment and a lack of supportive external and domestic factors.
The All Share Price Index (ASPI) fell 41.53 points, while the S&P SL20 declined 14.92 points, extending the market’s downward momentum. Total turnover reached Rs. 873 million, supported by four major crossings, while around 30 million shares changed hands through 10,403 transactions.
Banking stocks remained among the more active areas of the market, with Sampath Bank and Commercial Bank recording strong trading interest. LB Finance also performed well among financial sector counters, while John Keells Holdings (JKH) remained active during the session.
Four crossings accounted for a significant portion of market activity. Standard Chartered Capital crossed 3.9 million shares worth Rs. 150 million at Rs. 40 per share. Sampath Bank recorded a crossing of 688,000 shares valued at Rs. 96 million at Rs. 139.50, while Lanka IOC crossed 488,000 shares worth Rs. 63 million at Rs. 128.50. NDB also recorded a crossing of 500,000 shares valued at Rs. 55 million at Rs. 110.
In the retail market, Digital Mobility Solutions led turnover with Rs. 36 million from 237,000 shares. Ambeon Capital and LB Finance each generated around Rs. 34 million in turnover, with 1.1 million and 227,000 shares traded, respectively.
Commercial Bank recorded Rs. 27 million in turnover, followed by JKH at Rs. 23 million, Sampath Bank at Rs. 22 million and Hatton National Bank (HNB) at Rs. 20 million.
The banking sector’s relative resilience came alongside a positive development for Bank of Ceylon, with Fitch Ratings upgrading the state-owned bank’s Long-Term Foreign- and Local-Currency Issuer Default Ratings to ‘B-’ from ‘CCC+’, with a Stable Outlook, following Sri Lanka’s sovereign rating upgrade.
Fitch also raised the bank’s Viability Rating to ‘b-’ from ‘ccc+’ and its Short-Term Issuer Default Rating to ‘B’ from ‘C’, marking another improvement in the credit profile of a major state-owned financial institution.
Meanwhile, Aitken Spence Hotel Holdings PLC listed its rated, unsecured senior redeemable debentures on the CSE across five-year and seven-year maturities. The listing follows the hospitality group’s September debenture issue, which was oversubscribed on its opening day and sought to raise up to Rs. 5 billion.
In the foreign exchange market, the rupee was quoted at around Rs. 330.65–330.70 per US dollar in the spot market, compared with Rs. 330.60–330.70 on the previous trading day.
Government bond yields remained broadly stable, with limited movements recorded across selected maturities. The bond maturing on October 15, 2028 was quoted at 10.51%–10.54%, while the October 15, 2029 maturity remained around 10.80%–10.90%.
The August 1, 2030 bond was quoted at 11.10%–11.15%, while the October 15, 2030 maturity was quoted at 11.15%–11.20%. The December 15, 2032 bond was quoted at 11.65%–11.70%, while the October 15, 2034 maturity remained at 11.95%–12.00%.
Despite relative stability in fixed-income markets, currency performance remains a key concern for investors. The Central Bank of Sri Lanka said the rupee had depreciated 6.3% against the US dollar on a year-to-date basis by the end of September.
The combination of continued currency pressure, subdued turnover and weakness in the broader equity market is likely to keep investor sentiment cautious, even as selected banking and financial counters continue to attract interest.
