Stock market gains to 3-week closing high as blue chips gain

Colombo (Reuters): Shares rose for a third straight session on Monday and ended at a three-week closing high as investors picked up diversified and telecom shares, brokers said.

The Colombo stock index ended 0.12% firmer at 6,409.65, its highest close since 28 August.

The Bourse rose 0.4% last week, ending an eight-week long losing streak.

“We are yet to see the bullish trend, but it is slowly coming into the market with some foreign buying,” said Dimantha Mathew, head of research, First Capital Holdings.

“The Locals are a bit more conservative and are looking at only blue chips yet.”

Shares of conglomerate John Keells Holdings Plc gain 1.2% while Sri Lanka Telecom Plc ended 4.6% firmer, Melstacorp Ltd rose 1.7% and Dialog Axiata Plc ended 0.9% higher.

Foreign investors net bought Rs. 97.7 billion worth of shares on Monday, extending the year-to-date net foreign inflow to Rs. 17 billion worth of equities.

Turnover stood at Rs. 459.2 million, half of this year’s daily average of around Rs. 918.3 million.

According to traders, recent block deals also helped boost the market sentiment.

On Wednesday after market hours, diversified conglomerate Hayleys Plc said it had agreed to purchase 61.73% of Singer Sri Lanka Plc for 10.9 billion rupees from Retail Holdings (Sri Lanka) BV a subsidiary of Retail Holdings NV.

Hayleys in a corporate disclosure said on Friday that Hayleys Plc and its subsidiaries purchased 231.9 million shares or 61.73% of Singer Sri Lanka Plc at a price of Rs. 47 per share.

Last week, top mobile phone operator Dialog Axiata Plc said that it acquired 80.34% of Colombo Trust Finance Plc for Rs. 1.072 billion ($ 7 million).