(Reuters) - Sri Lankan stocks ended steady on Tuesday after the market surrendered early gains, as investors booked profits mainly in diversified and financial stocks in an overbought market, while some select stocks like Sri Lanka Telecom Plc outperformed the bourse.
The main stock index edged up 0.02 percent, or 1.13 points, to 7,176.10. The bourse hit its highest close since June 10, 2011 of 7,218.68 on Friday.
"Because of the profit-taking during the latter part of the day, the index ended flat. We have seen some profit-taking in overheated counters," said Dimantha Mathew, manager research at First Capital Equities (Pvt) Ltd.
Brokers said the market would continue its bullish run with foreign buying, low interest rates and good earnings expectations, despite profit-taking in some counters.
The index has gained 21.37 percent so far this year.
The bourse has been in an overbought region since July. The Relative Strength Index, a momentum indicator tracked by chartists, rose to 80.121 on Tuesday compared with Monday's 78.972, Thomson Reuters data showed.
Stocks are deemed "overbought" above the 70-mark, signalling a reversal in the near term.
Shares in Sri Lanka's leading fixed line telephone operator Sri Lanka Telecom Plc, which led the overall gain in the index, rose 2.64 percent during the day but ended flat at 53.10 rupees a share.
The day's turnover was 2.06 billion rupees ($15.81 million), more than this year's daily average of 1.25 billion rupees.
Foreign investors were net buyers of 116.4 million rupees worth of shares on Tuesday, extending the year to date net foreign buyers of 10.34 billion rupees.
The main stock index edged up 0.02 percent, or 1.13 points, to 7,176.10. The bourse hit its highest close since June 10, 2011 of 7,218.68 on Friday.
"Because of the profit-taking during the latter part of the day, the index ended flat. We have seen some profit-taking in overheated counters," said Dimantha Mathew, manager research at First Capital Equities (Pvt) Ltd.
Brokers said the market would continue its bullish run with foreign buying, low interest rates and good earnings expectations, despite profit-taking in some counters.
The index has gained 21.37 percent so far this year.
The bourse has been in an overbought region since July. The Relative Strength Index, a momentum indicator tracked by chartists, rose to 80.121 on Tuesday compared with Monday's 78.972, Thomson Reuters data showed.
Stocks are deemed "overbought" above the 70-mark, signalling a reversal in the near term.
Shares in Sri Lanka's leading fixed line telephone operator Sri Lanka Telecom Plc, which led the overall gain in the index, rose 2.64 percent during the day but ended flat at 53.10 rupees a share.
The day's turnover was 2.06 billion rupees ($15.81 million), more than this year's daily average of 1.25 billion rupees.
Foreign investors were net buyers of 116.4 million rupees worth of shares on Tuesday, extending the year to date net foreign buyers of 10.34 billion rupees.
($1 = 130.2800 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil Nair)
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