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Brokers and investors are likely to miss festive cheer as the Securities and Exchange Commission (SEC) yesterday felt it wiser to require more time to agree on the lifting of the price band and relaxing credit rules.
The Commissioners of the SEC held their first meeting under the new chairmanship of Tilak Karunaratne, but after a thorough deliberation decided to defer a final decision on broker recommendations to their next engagement, likely to be in the New Year.
Investors and brokers have been impatient ever since the industry recommended to both the SEC and President Mahinda Rajapaksa that lifting of the contentious price band and allowing two or three times net capital broker credit to clients would give a boost to the ailing stock market.
Following the Commis-sioners gathering, an SEC Spokesman told the Daily FT that a decision on broker requests was put off for the next meeting.
There was high expectation over a decision from yesterday’s meeting and this was evident by the fact that the market rose in early morning trade, though sentiments fizzled out by close.
Some analysts were concerned over indecision or delay on the part of the SEC to two straightforward recommendations.
In fact when the Colombo Stock Brokers Association (CSBA) originally proposed the moves during a meeting with former SEC Chairperson Indrani Sugathadasa, the impression conveyed by the regulator was that sympathetic and positive consideration was in order. There was an understanding that with the help of additional information, the SEC was to make a favourable decision at its next meeting.
However, the Chairperson resigned, while CSBA activated a direct line of communication with the President, leading to an unprecedented first-of-its-kind meeting between the country’s Chief Executive and broking community early this month.
It couldn’t be confirmed whether the SEC Commissioners felt any decision on their part would lift the market from its current precarious situation, with near Rs. 50 billion lost in market capitalisation since the new Chairman assumed duties.
Other analysts claimed that the lifting of the 10%-five market-day price band would be a psychological boost, though it may fail to trigger a major turnaround. They pointed to the market’s negative performance on Monday despite the Central Bank lifting the 5% ceiling on commercial bank lending to trading of securities.
However, CSBA yesterday welcomed the lifting , whilst analysts noted that unfortunately the holiday mood dented any major positive impact.
source-dailyft
The Commissioners of the SEC held their first meeting under the new chairmanship of Tilak Karunaratne, but after a thorough deliberation decided to defer a final decision on broker recommendations to their next engagement, likely to be in the New Year.
Investors and brokers have been impatient ever since the industry recommended to both the SEC and President Mahinda Rajapaksa that lifting of the contentious price band and allowing two or three times net capital broker credit to clients would give a boost to the ailing stock market.
Following the Commis-sioners gathering, an SEC Spokesman told the Daily FT that a decision on broker requests was put off for the next meeting.
There was high expectation over a decision from yesterday’s meeting and this was evident by the fact that the market rose in early morning trade, though sentiments fizzled out by close.
Some analysts were concerned over indecision or delay on the part of the SEC to two straightforward recommendations.
In fact when the Colombo Stock Brokers Association (CSBA) originally proposed the moves during a meeting with former SEC Chairperson Indrani Sugathadasa, the impression conveyed by the regulator was that sympathetic and positive consideration was in order. There was an understanding that with the help of additional information, the SEC was to make a favourable decision at its next meeting.
However, the Chairperson resigned, while CSBA activated a direct line of communication with the President, leading to an unprecedented first-of-its-kind meeting between the country’s Chief Executive and broking community early this month.
It couldn’t be confirmed whether the SEC Commissioners felt any decision on their part would lift the market from its current precarious situation, with near Rs. 50 billion lost in market capitalisation since the new Chairman assumed duties.
Other analysts claimed that the lifting of the 10%-five market-day price band would be a psychological boost, though it may fail to trigger a major turnaround. They pointed to the market’s negative performance on Monday despite the Central Bank lifting the 5% ceiling on commercial bank lending to trading of securities.
However, CSBA yesterday welcomed the lifting , whilst analysts noted that unfortunately the holiday mood dented any major positive impact.
source-dailyft
