Market welcomes lifting of 10 percent price band

By Hiran H. Senewiratne

 The Securities Exchange Commission (SEC) yesterday (19) lifted the 10 percent price band imposed on all listed securities, Acting Director General SEC Prof. Hareendra Dissabandara said.

"The SEC will continue to evaluate the behavior of the market and the price band will be re-imposed in future if the situation so warrants," Prof Dissabandara said in a short statement.

Stock brokering firms as well as investors welcomed the move because it would make a positive impact on the market which has been experiencing a lull.

Director/ General Manager Ceylinco Stock Brokers Sriyan Gurusinghe told the Island Financial Review that it was a very good move, which they had been asking for some time from the SEC.

"This would positively impact the market," he said.

Managing Director/CEO Capital Trust Securities (Pvt) Ltd Tushan Wickramasinghe said that the removal of the 10 percent price band was welcomed by all stockbrokers and investors even though it was long overdue.

He said it would give a fillip to the market without outside interference, because over time, each share’s market price was settled at its intrinsic value.

Head of Sales and Market Lanka Securities (Pvt) Limited Eardley Kern said that it was a good move as market manipulators took the advantage over the 10 percent threshold.

He also said if the SEC consults all stakeholders prior to implementing new regulations as it would help the market to flourish.

The price bands were imposed to curb speculative trading in junk stocks.

A market analyst said the SEC should tighten its surveillance and name and shame market manipulators without fear and favour.

One of the worst performing stock exchanges this year, the Colombo Stock Exchange has fallen 9.15 percent year-to-date.

source - www.island.lk