(Reuters) - Sri Lankan stocks fell to a more than one-month low on Monday, losing for a sixth consecutive session, as investors stayed on the sidelines amid rising interest rates and political uncertainty ahead of parliamentary elections.
The main stock index fell 0.66 percent, or 47.17 points, to 7,136.33, its lowest close since Feb. 5, extending the fall to 2.48 percent in the last six sessions.
"Local institutional and high net-worth investors were fairly inactive in the market," TKS Securities (Pvt) Ltd said in a note to investors.
Analysts said investors were waiting for clarity on interest rates and on the political front.
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 plans to raise 50 billion rupees ($376.36 million) through government securities this week, it said on its website.
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 in the polls.
Shares in Ceylon Tobacco Company Plc fell 1.93 percent, while Shalimar Estate declined 13.64 percent.
Turnover was 665.4 million rupees ($5 million), well below this year's daily average of 1.37 billion rupees.
Foreign investors were net buyers of 214.6 million rupees worth of shares, extending the year-to-date foreign inflow to 2.37 billion rupees.
($1 = 132.9500 Sri Lankan rupees)
The main stock index fell 0.66 percent, or 47.17 points, to 7,136.33, its lowest close since Feb. 5, extending the fall to 2.48 percent in the last six sessions.
"Local institutional and high net-worth investors were fairly inactive in the market," TKS Securities (Pvt) Ltd said in a note to investors.
Analysts said investors were waiting for clarity on interest rates and on the political front.
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 plans to raise 50 billion rupees ($376.36 million) through government securities this week, it said on its website.
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 in the polls.
Shares in Ceylon Tobacco Company Plc fell 1.93 percent, while Shalimar Estate declined 13.64 percent.
Turnover was 665.4 million rupees ($5 million), well below this year's daily average of 1.37 billion rupees.
Foreign investors were net buyers of 214.6 million rupees worth of shares, extending the year-to-date foreign inflow to 2.37 billion rupees.
($1 = 132.9500 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)
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