Sri Lankan stocks slightly weaker; turnover at over 6-month low

Dec 15 (Reuters) - Sri Lankan stocks ended weaker for a third straight session on Monday, led by market heavyweight John Keells Holdings as investors remained cautious ahead of the Jan. 8 presidential poll next month.

The main stock index ended 0.08 percent, or 6.11 points lower, at 7,230.26, its lowest close since Dec. 9.

Turnover was 340.4 million rupees ($2.6 million), according to stock exchange data, the lowest since May 26 and well below this year's daily average of 1.42 billion rupees.

Analysts and stockbrokers expect trading to be sluggish due to political uncertainty ahead of the next month presidential polls and the index to fall through December-end.

"But the downside is limited because whoever wins in the election, the market will gain because of lower interest rates," said Danushka Samarasignhe, chief operating officer at Softlogic Stockbrokers.

"The market will be lacklustre until the end of this year and we expect it to gain in the first week of January because there will be some political certainty by then."

Foreign investors bought a net 60.9 million rupees worth of shares, extending their net buying so far this year to around 22 billion rupees, exchange data showed.

Shares in Keells fell 0.43 percent to 252 rupees.

Nineteen candidates, including President Mahinda Rajapaksa and former health minister Mithripala Sirisena, the consensus candidate of a united opposition, submitted their nominations on Monday.

So far 11 loyalists from Rajapaksa's United People's Freedom Alliance, including Sirisena, have defected after he announced snap elections last month, while two opposition legislators have joined the ruling party.

Speculation over more defections also weighed on sentiment, analysts said.

($1 = 131.1000 Sri Lankan rupees) 

(Reporting by Shihar Aneez; Editing by Prateek Chatterjee)

Russian rouble crisis Tea exporters voice grave concern

By Ravi Ladduwahetty

Ceylon Finance Today: Sri Lanka's tea exporters have voiced grave concern over their tea exports to Russia and the Combined Independent States following the devaluation of the Russian currency in the aftermath of the sanctions imposed by the United States on that country.

'This is a very serious situation which has prevailed for the last one year or so and we are hopeful that the government will step to mediate in this national crisis,' Chairman of the Tea Exporters' Association of Sri Lanka, Rohan Fernando told Ceylon FT yesterday.

This is a twin issue with the Russian supermarkets not willing to pay extra for the Ceylon Tea in the wake of the devaluation and on top of that, is the falling of the world tea prices as well. In fact, the Russian importers are asking for a price reduction and deferred payments as well which has aggravated the issue, he noted.

Fernando, who is the Chairman of the Colombo Stock Exchange – listed HVA Foods PLC said that the members of the association has asked for a meeting with the Governor of the Central Bank of Sri Lanka, Ajith Nivard Cabraal and Plantation Industries Minister, Mahinda Samarasinghe hoping that the government will intervene in the situation.

He also said that one of the solutions would be for the governments of Russia and the United States to negotiate a barter agreement between Sri Lanka where Sri Lanka imports petroleum from Russia in lieu of the tea. He also proposed that Sri Lanka signs up a deal with China, which would enable Sri Lanka to be paid in Chinese Remimbi for tea exports to Russia due to the excellent diplomatic relationships between Russia and China and also due to the excellent relationships that exist between Russia, China and Sri Lanka.

He also expressed his grave concern about the future of Sri Lanka's tea exports to Syria and Iran which are also facing US sanctions, which with China account for 60% of Sri Lanka's tea exports.
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