CSE getting ready for a hard landing

Antonym · 1 Circuit Breaker attached to S&P SL20 Fri May 01, 2020 8:44 am

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Three-Tiered Circuit Breaker Structure

i. First Circuit Breaker –After commencement of trading of the Colombo Stock Exchange (CSE) for the day, a Market Halt to be imposed for 30 minutes in the event the S&P SL20 index drops by 5%.

ii. Second Circuit Breaker – Having re-commenced trading after the cooling off period of 30 minutes following the S&P SL20 drop of 5%, if the S&P SL20 index drops again by another 2.5%, a Market Halt to be imposed for another 30 minutes.

iii. Third Circuit Breaker - Upon re-commencing trading subsequent to cooling off period of 30 minutes following the S&P SL20 drop of 2.5% (altogether S&P SL20 has dropped by 7.5%) if the S&P SL20 index drops by a further 2.5% (S&P SL20 index has fallen altogether by 10% for the day), trading will be halted and the market shall be closed for the day.

http://www.sec.gov.lk/wp-content/uploads/Directive7.pdf

cseguide · 2 Re: CSE getting ready for a hard landing Fri May 01, 2020 11:22 am

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Are there any day fixed market to be opened ?

wallstreetguy · 3 Re: CSE getting ready for a hard landing Fri May 01, 2020 11:49 am

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This is not a good sign as there is market intervention taking place. The more you put restrictions, the more people will exit the market. I remember how circuit breakers were first introduced and how it affected CSE. Coming colours are not good. The economy has been downgraded also to near junk status. Bonds are being undersubscribed. Its better to exit with what ever you can take and come back later.

As much as SEC is trying to control ny intervening, you should let the market be free. They had already closed for more than a month and people are waiting to pull their money. Even WFE is also not pleased with how SrI Lanka ks operating. They might even revoke our membership is it continues.

cseguide · 4 Re: CSE getting ready for a hard landing Fri May 01, 2020 8:09 pm

cseguide

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yes, I continuously stated that closer of market more than one month is not good at all for our market. most probably more foreigners and foreign funds will exit the market for sure. This can bring the market for its all-time low this time. All investors should put some pressure to open the market soon.

anges · 5 Re: CSE getting ready for a hard landing Fri May 01, 2020 9:37 pm

anges

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bad sentiment for the market ! regulators concern only market fall ! i feel big fish need a little time to unload the stocks ! if there is a free fall they will have to sell cheaply so protection from the regulators ! advice to retailers sell as soon as possible

Eugine Fernando · 6 Re: CSE getting ready for a hard landing Sat May 02, 2020 10:30 am

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cseguide wrote:yes, I continuously stated that closer of market more than one month is not good at all for our market. most probably more foreigners and foreign funds will exit the market for sure. This can bring the market for its all-time low this time. All investors should put some pressure to open the market soon.

Hopefully Market will be open on 11th May.

ChooBoy · 7 CSE getting ready for a hard landing Sat May 02, 2020 8:47 pm

ChooBoy

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Sri Lanka CSE is preparing for hand landing
CSE getting ready for a hard landing 40d84rn5ozm?alt=media&token=a07b4a83-8b56-4914-a3b0-9d474566ac42

CSE getting ready for a hard landing 40d84rn5ozm?alt=media&token=a07b4a83-8b56-4914-a3b0-9d474566ac42

Sri Lanka stock market has been closed since 20th March after imposed curfew for the whole Island to combat COVID19. Other than Sri Lanka & Bangladesh Asian stock markets are active and they have found the bottom and bounced back from mid-April. Many in the industry believe ASPI face significant correction after it starts trading again. Meanwhile, SEC has taken into consideration the prevailing market conditions and amend the current methodology pertaining to Index-Based Circuit Breakers by introducing a Three Tiered Circuit Breaker structure which is to be attached to the S&P SL20 Index. As per the SEC, Accordingly, Three Tiered Circuit Breaker structure is introduced in order to strengthen the capital market and ensure that precautionary measures are in place to eradicate distortion in the S&P SL20 Index by providing a layered approach.