Stock market’s rise continues

Reuters - Shares gained on Friday to hit a more than six-month closing high on foreign buying in market heavyweight John Keells Holdings, helping boost the overall sentiment.

Foreign investors net-bought equities worth Rs. 1.35 billion ($8.88 million) on Friday, extending the week’s net foreign buying to Rs. 6.56 billion.

Foreign investors have been net buyers for the last 21 sessions, acquiring equities worth a net 11.77 billion, taking the year-to-date net foreign inflow into equities to Rs. 14.27 billion.

The Colombo stock index ended 0.5% firmer at 6,535.54, its highest close since 11 October. It has climbed 9.4% in the 16 sessions through Friday, having risen for 15 sessions in that period.

The index added 2.1% on the week, marking its fourth week of gains.

“Foreign investors see extremely attractive valuation in the blue chips and growing earnings. They also see some political stability and stabilisation of the economy,” First Capital Equities Ltd Head of Research Dimantha Mathew said.

“But local investors are still waiting for some kind of strong direction by the Government. The bullish run will prevail in the near future with local investors also starting to buy into equities.”

Stockbrokers said the market was also encouraged by comments made by President Maithripala Sirisena on making the Government effective, as reported in the local media.

Turnover stood at Rs. 3.27 billion ($21.51 million), more than three times of this year’s daily average of Rs. 877.8 million.

John Keells Holdings, which accounted for 81% of the day’s turnover, jumped 2.2%, while top lender Commercial Bank of Ceylon rose 1.7%.