Reuters: Sri Lanka's stock index fell for the second straight session on Tuesday to close at its lowest in more than seven weeks, with turnover slumping to a near three-month low as concerns over political uncertainty dented demand for risky assets.
President Maithripala Sirisena's government has said it would dissolve parliament once some crucial reforms including an electoral bill are passed, but has yet to fix a date for the election.
The main stock index ended down 0.16 percent at 7,067.11, slipping to its lowest closing level since April 15.
"Elections might be the triggering point. There is no buying and it'll be like this till the announcement of the elections," said Dimantha Mathew, research manager at First Capital Equities (Pvt) Ltd.
Some stockbrokers said investors were waiting for the right moment, and sellers were not ready to dispose of holdings at low prices given the lack of buying interest.
Turnover was 328.8 million rupees ($2.46 million), the lowest since March 13 and well below this year's daily average of about 1.11 billion rupees.
Analysts said foreign investors have been selling shares amid expectations the U.S. would hike key interest rates sooner than later. An upbeat U.S. nonfarm payrolls in May, the largest gain since December, has raised chances for a rate hike as early as September.
Foreign investors sold a net 6.9 million rupees ($51,608) worth of shares, extending net foreign outflow to 1.52 billion rupees worth shares in the past ten sessions.
The bourse, however, has seen net inflows of 4.42 billion rupees in equities so far this year.
Political uncertainty due to the Ranil Wickremesinghe-led coalition government not having a parliament majority has been a drag on the market, though the trend reversed after the central bank cut key monetary policy rates to record lows on April 15.
Stockbrokers said better corporate earnings would help the market gain.
Shares in Ceylon Tobacco Company Plc eased 2.64 percent while Nestle Lanka Plc fell 2.27 percent.
President Maithripala Sirisena's government has said it would dissolve parliament once some crucial reforms including an electoral bill are passed, but has yet to fix a date for the election.
The main stock index ended down 0.16 percent at 7,067.11, slipping to its lowest closing level since April 15.
"Elections might be the triggering point. There is no buying and it'll be like this till the announcement of the elections," said Dimantha Mathew, research manager at First Capital Equities (Pvt) Ltd.
Some stockbrokers said investors were waiting for the right moment, and sellers were not ready to dispose of holdings at low prices given the lack of buying interest.
Turnover was 328.8 million rupees ($2.46 million), the lowest since March 13 and well below this year's daily average of about 1.11 billion rupees.
Analysts said foreign investors have been selling shares amid expectations the U.S. would hike key interest rates sooner than later. An upbeat U.S. nonfarm payrolls in May, the largest gain since December, has raised chances for a rate hike as early as September.
Foreign investors sold a net 6.9 million rupees ($51,608) worth of shares, extending net foreign outflow to 1.52 billion rupees worth shares in the past ten sessions.
The bourse, however, has seen net inflows of 4.42 billion rupees in equities so far this year.
Political uncertainty due to the Ranil Wickremesinghe-led coalition government not having a parliament majority has been a drag on the market, though the trend reversed after the central bank cut key monetary policy rates to record lows on April 15.
Stockbrokers said better corporate earnings would help the market gain.
Shares in Ceylon Tobacco Company Plc eased 2.64 percent while Nestle Lanka Plc fell 2.27 percent.
($1 = 133.7000 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)
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