Bourse edges down; traders await fresh cues

Colombo (Reuters): Shares ended marginally lower on Monday, with traders staying on the sidelines for want of fresh triggers amid expectations of certain amendments in the Budget.

The Colombo stock index ended 0.15% weaker at 6,473.87. It had lost 1% last week.

“We expect the market to prevail at these levels for this year. Foreign interest is still there on some select shares,” said Hussain Gani, deputy CEO at Softlogic Stockbrokers.

“They (foreign investors) see value in these stocks and the P/E ratio is also low.” The final budget vote is scheduled for 9 December and the market expects some amendments that could help give the markets some direction.

Market heavyweight John Keells Holdings fell 0.7% while Lanka Orix Leasing Company closed 2.2% lower.

Foreign investors net bought equities worth Rs. 40.2 million ($ 261,548) on Monday, extending the foreign inflows to Rs. 19.6 billion so far this year.

Finance Minister Mangala Samaraweera imposed new taxes on motor vehicles, telecoms, banks and liquor in a bid to boost revenues in as the budget deficit for the current year slipped to 5.2% of the gross domestic product.

Samaraweera imposed taxes on telecom towers and text messages, and introduced a debt repayment levy of 20 cents per 1,000 rupee bank transaction with effect from 1 April next year.

Analysts said the market players have sought more clarification on these taxes and perhaps there could be amendments to these proposals before the final vote.

Turnover was Rs. 707.8 million on Monday, less than this year’s average of around Rs. 952.5 million.