Wednesday 8 March 2017

Sri Lankan shares post 1-month closing low; foreign investors extend buying

Reuters: Sri Lankan shares fell to their lowest close in one month on Wednesday, led by financial and telecommunication stocks as investor sentiment continued to remain low on concerns about rising interest rates.

Foreign investors were net buyers for the sixth straight session, purchasing shares worth 154.8 million rupees ($1.02 million), and extending the year-to-date net foreign inflow to 1.88 billion rupees worth of equities.

Foreign trading accounted for more than 50 percent of the day's turnover of 1.06 billion rupees. This year, the daily average has been 685.5 million rupees.

"Foreign investors are buying stocks in which they see some value after prices have come down," said Hussain Gani, deputy CEO at Softlogic Stockbrokers.

The Colombo stock index ended down 0.21 percent at 6,095.07. It shed 0.6 percent last week in its second straight weekly decline.

Traders said there were concerns after the International Monetary Fund urged Sri Lanka's central bank to be ready to tighten monetary policy if credit growth or inflation do not abate.

Shares in Commercial Bank of Ceylon Plc, the country's biggest listed lender, fell 1.27 percent while Dialog Axiata Plc declined 0.89 percent.

Yields on treasury bills have risen to a more than four-year high since October, while the central bank has kept key policy rates on hold. 

($1 = 151.3000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

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