(Reuters) - Sri Lankan stocks fell to a more than one-month low on Tuesday, losing for a seventh consecutive session, as investors stayed on the sidelines amid rising interest rates and political uncertainty ahead of parliamentary elections.
The main stock index fell 0.09 percent, or 6.28 points, to 7,130.05, its lowest close since Feb. 5, extending the fall to 2.56 percent in the last seven sessions.
"Everybody is waiting for directions on the interest rates and political front," a stockbroker said on condition of anonymity.
Foreign investors were net buyers of 106.9 million rupees worth of shares, extending the year-to-date foreign inflow to 2.48 billion rupees.
The central bank removed a penalty rate of 5 percent on its repo rate with effect from March 2. The bank had imposed the penalty in September to discourage commercial banks from parking money with it at an interest rate of 6.5 percent.
The scrapping of the penalty resulted in a rise in t-bill yields of between 86 basis points and 91 basis points last Tuesday.
The central bank raised 51.8 billion rupees ($389.77 million) through sale of treasury bonds on Tuesday, 72.8 percent higher than what it offered. It borrowed $156.5 million through development bonds on Monday.
The central bank also plans to raise 20 billion rupees ($150.49 million) through t-bills on Wednesday.
Elections to Sri Lanka's 225-member parliament are expected to be announced after April 23 and it is unclear whether the ruling coalition led by President Maithripala Sirisena would contest unitedly or go to the polls separately.
Political analysts expect a hung parliament if Sirisena's coalition members contest separately.
Shares in Ceylon Tobacco Company Plc fell 1.85 percent, while Ceylinco Insurance Company Plc fell 1.39 percent.
Turnover was 585.6 million rupees, well below this year's daily average of 1.37 billion rupees.
The main stock index fell 0.09 percent, or 6.28 points, to 7,130.05, its lowest close since Feb. 5, extending the fall to 2.56 percent in the last seven sessions.
"Everybody is waiting for directions on the interest rates and political front," a stockbroker said on condition of anonymity.
Foreign investors were net buyers of 106.9 million rupees worth of shares, extending the year-to-date foreign inflow to 2.48 billion rupees.
The central bank removed a penalty rate of 5 percent on its repo rate with effect from March 2. The bank had imposed the penalty in September to discourage commercial banks from parking money with it at an interest rate of 6.5 percent.
The scrapping of the penalty resulted in a rise in t-bill yields of between 86 basis points and 91 basis points last Tuesday.
The central bank raised 51.8 billion rupees ($389.77 million) through sale of treasury bonds on Tuesday, 72.8 percent higher than what it offered. It borrowed $156.5 million through development bonds on Monday.
The central bank also plans to raise 20 billion rupees ($150.49 million) through t-bills on Wednesday.
Elections to Sri Lanka's 225-member parliament are expected to be announced after April 23 and it is unclear whether the ruling coalition led by President Maithripala Sirisena would contest unitedly or go to the polls separately.
Political analysts expect a hung parliament if Sirisena's coalition members contest separately.
Shares in Ceylon Tobacco Company Plc fell 1.85 percent, while Ceylinco Insurance Company Plc fell 1.39 percent.
Turnover was 585.6 million rupees, well below this year's daily average of 1.37 billion rupees.
($1 = 132.9000 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)
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