The benchmark CSE All Share Index closed down 2.26% at 4,879.8, its biggest one-day percentage drop since May 12 and marked its second straight session of losses.
Lanka will also delay the opening up of its airports, local media reported, quoting the country's civil aviation minister.
The benchmark CSE All Share Index closed down about 0.1% at 5,149.57.
Industrial conglomerate John Keells Holdings Plc and mobile service operator Dialog Axiata PLC were the biggest drags, falling 1.6% and 2.5%, respectively.
Shares of conglomerate John Keells Holdings Plc fell 1.2pc on Friday and were the biggest drag on the index followed by investment firm Bukit Darah Plc, which shed 6.8pc.
The Sri Lankan rupee was quoted at 185.4 against the US dollar as of 1210 GMT, about 0.2pc weaker compared with last session's close of 185.05, according to Refinitiv data.