Sri Lankan shares fall to 1-mth low; Chevron Lubricants leads

Reuters: Sri Lankan shares fell on Wednesday to a one-month closing low, marking their sixth losing session in seven, led by the decline in Chevron Lubricants Lanka after it reported a drop in the June-quarter earnings.

Chevron Lubricants stock lost 6.3 percent on Wednesday after the company reported a 34 percent fall in its second-quarter profit.

The Colombo stock index ended 0.59 percent lower at 6,695.23, its lowest since June 16, marking a third straight losing session.

"There was selling pressure after the Chevron Lubricants' earnings. Some other blue chips also were under selling pressure," said Dimantha Mathew, head of research, First Capital Holdings.

However, foreign investors continued to buy stocks. They were net buyers of shares worth 113.5 million rupees ($738,932)on Tuesday, extending the year-to-date net foreign inflow to 24.4 billion rupees worth of equities.

Turnover was 781.6 million rupees, less than this year's daily average of 912.8 million rupees.

Shares of conglomerate Hemas Holdings fell 3.6 percent, while telecom company Dialog Axiata fell 1.7 percent. 

($1 = 153.6000 Sri Lankan rupees) 

(Reporting by Shihar Aneez; Editing by Amrutha Gayathri)

Sri Lankan shares fall for fifth session in six

Reuters: Sri Lankan shares closed lower on Tuesday, marking their fifth session of decline in six, although foreign investors continued to buy stocks.

Domestic investors were concerned about a possible increase in interest rate, analysts said, after the International Monetary Fund said further monetary policy tightening in Sri Lanka was desirable until there were clear signs that inflationary pressures were subsiding.

Foreign investors were net buyers of shares worth 658.9 million rupees ($4.3 million) on Monday, extending the year-to-date net foreign inflow to 24.3 billion rupees worth of equities.

The Colombo stock index ended 0.09 percent lower at 6,735.04, marking a second straight losing session.

"The turnover was good and there was a huge interest in select shares," said Prashan Fernando, CEO at Acuity Stockbrokers.

Turnover was 1.25 billion rupees, more than this year's daily average of 913.4 million rupees.

Shares of large cap Ceylinco Insurance fell 7.35 percent, while Ceylon Tobacco Company edged down 0.8 percent.

($1 = 153.7500 Sri Lankan rupees)

( Reporting by Shihar Aneez; Editing by Amrutha Gayathri)

Sri Lankan shares fall on profit-taking in blue chips

REUTERS: - Sri Lankan shares fell on Monday, after posting their highest close in more than 18 months in the previous session, as investors booked profits in blue chips.

However, foreign players bought stocks on expectations of strong corporate earnings, limiting the downside.

The Colombo stock index dropped 0.37 percent to 6,741.07, its fourth session of decline in five.

"There was some profit-taking. But the turnover level was good and foreign investors were still on the buying side," said Hussain Gani, deputy CEO, Softlogic Stockbrokers.

The market could see a rising trend if yields on fixed-income securities fall as expected by the central bank, said analysts.

The central bank expects a further fall in T-bill yields due to less pressure from government borrowing and a proposed new auction system, Deputy Governor Nandalal Weerasinghe said in an interview with Reuters last week.

Foreign investors were net buyers of shares worth 155 million rupees ($1.01 million) on Monday, extending the year-to-date net foreign inflow to 23.6 billion rupees worth of equities this year.

Turnover was 736.4 million rupees, less than this year's daily average of 911 million rupees.

New foreign investors have been buying Sri Lankan shares since the Pakistani bourse was upgraded as an emerging market from a frontier one, said analysts.

Brokers said domestic investors have been waiting for clarity on the proposed inland revenue legislation, which some companies expect would result in higher costs of production.

The IMF, which has long urged Sri Lanka to boost tax revenue through modernisation and simplification of its fiscal system, has urged the government to submit to parliament a new Inland Revenue Act.

Shares of private lender Hatton National Bank fell 1.9 percent, while Commercial bank of Ceylon Plc, the country's biggest listed lender, ended 0.4 percent lower. 

($1 = 153.7000 Sri Lankan rupees) 

(Reporting by Shihar Aneez; Editing by Subhranshu Sahu)

Sri Lankan shares hit 18-month closing high on foreign buying

Reuters: Sri Lankan shares posted their highest close in more than 18 months on Friday led by foreign buying in blue chips on expectations of strong corporate earnings, while improved local buying also helped boost sentiment.

The Colombo stock index snapped three sessions of declines to end 0.41 percent higher at 6,766.14, its highest close since Jan. 8, 2016.

"Foreign investors have been buying because they expect improvement in earnings in the future," said Hussain Gani, deputy CEO, Softlogic Stockbrokers.

"They see value in our markets with lower PE ratio. Unless there is volatility in the exchange rate and interest rate, the market should gain with continuous foreign buying."

The market could see a rising trend if yields on fixed-income securities fall as expected by the central bank, said analysts.

The central bank expects a further fall in T-bill yields due to less pressure from government borrowing and a proposed new auction system, Deputy Governor Nandalal Weerasinghe said in an interview with Reuters on Wednesday.

Foreign investors were net buyers of shares worth 478.1 million rupees, extending the year-to-date net foreign inflow to 23.4 billion rupees worth of equities this year.

The day's turnover was 1.63 billion rupees, higher than this year's daily average of 912.1 million rupees.

New foreign investors have been buying Sri Lankan shares since the Pakistani bourse was upgraded as an emerging market from a frontier one, said analysts.

Brokers said domestic investors have been waiting for clarity on the proposed inland revenue legislation, which some companies expect would result in higher costs of production.

The IMF, which has long urged Sri Lanka to boost tax revenue through modernisation and simplification of its fiscal system, has urged the government to submit to parliament a new Inland Revenue Act.

Shares of conglomerate John Keells Holdings Plc closed 0.2 percent higher, while Commercial bank of Ceylon Plc , the country's biggest listed lender, ended 0.3 percent higher.

($1 = 153.7000 Sri Lankan rupees)

(Reporting by Shihar Aneez; Editing by Sherry Jacob-Phillips)

Sri Lankan shares post near 1-week closing low

Reuters: Sri Lankan shares posted their lowest close in nearly one week in low trading on Thursday as local investors booked profits while foreign players bought into risky assets, limiting the decline.

The Colombo stock index ended 0.11 percent weaker at 6,738.42, declining for the third straight session.

"Local retail profit-taking brought the market down," said Hussain Gani, deputy CEO of Softlogic Stockbrokers.

The market could see a rising trend if yields on fixed-income securities fall as expected by the central bank, said analysts.

The central bank expects a further fall in T-bill yields due to less pressure from government borrowing and a proposed new auction system, Deputy Governor Nandalal Weerasinghe said on Wednesday.

Foreign investors were net buyers of shares worth 166.3 million rupees ($1.08 million), extending the year-to-date net foreign inflow to 23 billion rupees worth of equities this year.

The day's turnover was 489.4 million rupees, compared with this year's daily average of 906.6 million rupees.

New foreign investors have been buying Sri Lankan shares since the Pakistani bourse was upgraded as an emerging market from a frontier one, said analysts.

Brokers said domestic investors have been waiting for clarity on the proposed inland revenue legislation, which some companies expect would result in higher costs of production.

The IMF, which has long urged Sri Lanka to boost tax revenue through modernisation and simplification of its fiscal system, has urged the government to submit to parliament a new Inland Revenue Act.

Shares of conglomerate John Keells Holdings Plc closed 0.1 percent lower, Trans Asia Hotels Plc fell 5.5 percent and Commercial bank of Ceylon Plc, the country's biggest listed lender, ended 0.3 percent weaker. 

($1 = 153.7000 Sri Lankan rupees) 

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

Sri Lankan shares ends steady in moderate trade; foreigners sell

Reuters: Sri Lankan stocks ended steady on Wednesday as gains in consumer staple shares were offset by industrial stocks led by John Keells Holdings Plc, while concern over a proposed tax bill weighed on overall sentiment.

The Colombo stock index ended 0.03 percent weaker at 6,748.15, slipping from its highest close since Jan. 7, 2016, in the previous session.

"There was some trade by institutional investors. Other than that, the day was quiet," said Prashan Fernando, CEO at Acuity Stockbrokers.

However, Fernando said the market could see a rising trend if yields in fixed-asset income falls, as the central bank expected on Wednesday.

The monetary authority expects a further fall in T-bill yields due to less pressure from government borrowing and a proposed new auction system, the bank's deputy governor, Nandalal Weerasinghe, said.

The bourse saw net foreign outflows for the first time in 13 sessions, with net selling of 27.9 million rupees ($181,700) worth of shares. But foreign investors have been net buyers of 22.8 billion rupees worth of equities this year.

The day's turnover was 557.9 million rupees, off this year's daily average of 909.9 million rupees.

Analysts said new foreign investors have been buying Sri Lankan shares since the Pakistani bourse was upgraded to emerging market status from frontier market.

In May, index provider MSCI announced changes to its indexes as a result of its semi-annual market reclassification, including reclassifying Pakistan, and the addition of 57 securities and removal of 28 securities from its All-Country World Index.

Brokers said domestic investors had been waiting for some clarity on proposed inland revenue legislation, which some companies expect would result in higher costs of production.

The IMF, which has long urged Sri Lanka to boost tax revenue through modernisation and simplification of its fiscal system, has urged the government to submit to parliament a new Inland Revenue Act.

Shares of conglomerate John Keells Holdings Plc closed 0.6 percent lower, gains were led by Bukit Darah Plc which rose 4.3 percent. 

($1 = 153.5500 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Robert Birsel)

Web of deals between Perpetual Treasuries, EPF, Sri Lanka Insurance, NSB revealed

ECONOMYNEXT - Sri Lanka's Employment Provident Fund, a state insurer and a savings bank, bought bonds originally held by Perpetual Treasuries at pre-arranged rates from PABC Bank, a commercial bank, a commission inquiring into a securities scam was told.

Richard Benedict Dias, head of PABC Bank's Treasury, said billions of rupees of bonds were bought from Perpetual Treasuries, a firm connected to ex-Central Bank Governor Arjuna Mahendran's son-in-law Arjun Aloysius, and re-sold to the Employment Provident Fund.

The bonds were bought by Saman Kumara, an official at the EPF, which is managed by the Central Bank, he said.

Dias said trades were also made with National Savings Bank and Sri Lanka Insurance Corporation, responding to questions by Commissioner Prasanna Jayawardene whether similar deals were made with other state entities.

The commission is inquiring into alleged rigged auctions of government bonds during 2015 and 2016, where billions of rupees of bonds were bought by Perpetual Treasuries at high yields (low prices) and dumped mostly on the EPF at low yields (high prices), as well as on other entities.

Dias was examined by Perpetual Treasuries' lawyer Nihal Fernando on Tuesday, following evidence given earlier, where he had indicated that Perpetual's Aloysius had attempted to influence his testimony, pleading with him to come to his house.

Pre-arranged deals
Dias said he could not comment on the rates at which the deals were done on the instructions of Perpetual and did not examine the market to compare before carrying them out.

If SLIC bought the bonds, the onus was on the institution to do so, he said.

"We were told that SLIC had agreed to the rate," he said.

Dias said he could not recall whether any deals made with the NSB was made on the own initiative of PABC, outside of instructions received.

Deputy Solicitor General Milinda Gunatilleke played a taped conversation at the dealing room of PABC where dealers were talking about the apparent staged trades with EPF's Saman Kumara, shortly before calling to close a deal to sell bonds to the retirement fund.

Gunatilleke said the tapes showed that deals with EPF were not bona fide.

Commissioner Jayawardene said the commission will make up its mind whether the deals were done to mask the information that the original seller to EPF was Perpetual Treasuries.

PABC itself did not like to trade on its own account for long term bonds and preferred to deal in securities under five years, Dias said.

It bought bonds mostly to fulfil statutory and client requirements, Dias said. Some bonds it bought at auctions were sold back-to-back to Perpetual even before the settlement date, he said.

Perera Factor
PABC has started to do deals for Perpetual Treasuries at pre-arranged rates, following instructions from then PABC chairman Nimal Perera. PABC had also made a small margin on the deals.

Nimal Perera also had a portfolio and bought bonds through the PABC, Dias said. Nimal Perera later left the bank, after falling out with major shareholder Dhammika Perera.

Dias said he feared that he would lose his job for carrying out instructions of Nimal Perera after two other officials in another section of the bank who had provided loans and margin facilities were sacked. He understood that they had also given the facilities under instructions from Perera, he said. As a result, he feared that he may also lose his job, he said, though he was 'absolutely' sure that he had not done anything against the rules.

PABC's board had previously questioned him and he had explained but following media reports about PABC's involvement in bond deals. But he had fresh concerns.

He said he had heard from the Chief Executive's secretary that the CEO was concerned about the issue. Dias said he was aware that the bank was concerned over its reputation following an electronic media report.

Subsequently major shareholder Dhammika Perera had called him after meeting the CEO.

He was asked in Sinhalese whether any laws had been broken.

He had told Perera that he was sure that non had been broken, and that he had not even accepted a 'cup of tea' from these people (may golla), and only small profits were made from the deals.

Subsequently Aloysius had called him to ask why he said only small profits were made. Dias said he assumed a conversation had taken place between Perera and Aloysius.

Commissioner Jayawardene questioned who the 'maygolla' referred to in the conversation with Dhammika Perera, whether it was the nexus between Perpetual and the EPF.

Counsel for Aloysius questioned whether it was the practice of the bank CEO to brief all shareholders about the status of the bank. Dias said he was aware that Perera was briefed from time to time.