CSE dips to near 3-week closing low on foreign selling

Reuters: Sri Lankan shares ended weaker yesterday, hovering at their lowest close in three weeks, as foreign investors offloaded blue-chip stocks such as John Keells Holdings PLC, while lacklustre corporate results dented sentiment further.

The Colombo stock index ended 0.29% weaker at 6,129.32, near its lowest close since 12 July. The bourse dropped 3.8% so far this year.

The index dropped 0.47% last week, marking its first weekly decline in three.

Turnover stood at Rs. 374.4 million ($2.35 million), less than this year’s daily average of Rs. 852.6 million.

“The market is down mainly because of the foreign selling,” said First Capital Holdings research head Dimantha Mathew.

“Today the local buying was not there to absorb foreign selling,” he added.

Foreign investors sold equities net worth Rs. 116.4 million yesterday, extending the year-to-date net foreign outflow to Rs. 2.6 billion worth of equities so far this year.

A downward revision in economic growth estimate earlier this month by the Central Bank also hurt sentiment, analysts said.

Economic growth in 2018 is likely to be between 4% and 4.5%, falling short of an earlier estimate of 5%, Central Bank Governor Indrajit Coomaraswamy said earlier this month.

Shares in conglomerate John Keells Holding PLC ended down 2.6%, while Melstacorp Ltd closed 3% lower. The biggest-listed lender Commercial Bank of Ceylon PLC ended 1.5% down and Distillers Company of Sri Lanka PLC closed 0.4% down.