Sri Lanka's largest business group opposes decision to close stock market

Sri Lanka's largest business group Ceylon Chamber of Commerce has opposed a decision by the Securities and Exchange Commission (SEC) to close the stock market for five working days.

By shutting down the stock market, potential sellers are prevented from exiting the market at the time and price of their choice, and potential buyers are prevented from acquiring shares, the Chamber said on Sunday.

"All investors will be unable to carry out valuations and mark to market their respective investment portfolios," Chairman of the Chamber, Vish Govindasamy said in a letter to SEC Chairman Viraj Dayaratne.

Govindasamy said there are circuit breakers in place to arrest a sharp movement in market indices, and the Chamber believes that there is no need to close the market in this manner sending out a wrong signal to all investors across the globe, Xinhua news agency reported.

"Therefore, we earnestly request you to reconsider this move and direct the Colombo Stock Exchange to operate freely even amid challenging market conditions safeguarding its reputation as an investor-friendly stock market," he added.

On Saturday, the SEC announced that it had decided to direct the Colombo Stock Exchange to temporarily close the stock market for a period of five business days starting April 18.

The SEC said it would be in the best interests of investors as well as other market participants if they are afforded an opportunity to have more clarity and understanding of the economic conditions presently prevalent, in order for them to make informed investment decisions.

The Colombo Stock Exchange has been adversely affected by the economic woes in the South Asian country and the index has fallen 26 per cent by the end of March compared to the end of 2021.