Living with violence - Colombo bourse

Some stock market investors, weary but accustomed by the war, are partly the reason for the recent boom at the Colombo bourse by realising that the conflict is there to stay – at least for another 20 years.

“Investors have come to terms with the violence. The common thinking among investors is that despite peace talks failing, it will take another 20 years to solve the ethnic issue, because of ‘sheer necessity’ for both parties to find a solution,” a market analyst said.

He said healthy corporate earnings also contributed to this positive thinking and factoring all of these, investors were taking firm positions now, because they do not want to be too late.

Other analysts however believe the market is not showing its real value. “The market is overheated and it should correct itself soon,” Harsha Fernando, Head of SE Securities said.A stock broker said that the ‘downside’ to the macro economic landscape is limited and the stock market is booming, because the investment potential is high.

“The war is not factored in the present scenario and foreign investment and funds are coming in.

There is a lot of infrastructure projects happening, which will trickle down to the bottom lines. Also there is a hope that the UNP will support the budget,” he said.