CSE gains for 4th session; rupee edges lower

REUTERS: Shares rose for the fourth straight session on Friday to a more than 12-week closing high, a day after the Central Bank kept its key policy rates steady. 

The Central Bank left key interest rates unchanged on Thursday as expected, after cutting them in May to support the economy as tourism and investment plummeted in the wake of deadly suicide bombings in April. 

The benchmark stock index gained 0.16% to 5,569.94, its highest close since 18 April.

The index rose 1% for the week, its third consecutive weekly gain, as investor sentiment was buoyed by the Government’s decision to launch a $2.2 billion Japan-funded Light Railway Transit (LRT) project and some other stalled infrastructure projects, brokers said. So far this year, the index is down about 8%. 

Shares in Dialog Axiata PLC jumped 4.21%, Ceylon Cold Stores PLC ended 4.72% firmer, Hatton National Bank PLC closed up 3.76%, and Lion Brewery PLC rose 3.64%. 

Stock market turnover was Rs. 365 million ($2.08 million), below this year’s daily average of about Rs. 540.8 million. Last year’s daily average came in at Rs. 834 million. 

Foreign investors sold a net Rs. 2.2 million worth of shares on Friday, extending the year-to-date net foreign outflow to Rs. 7.29 billion, index data showed. 

The currency closed a tad weaker at 175.45/55 per dollar, compared with Thursday’s close of 175.35/45, as importer demand for the greenback surpassed dollar selling by banks. The rupee rose 0.37% for the week, and is up 4.08% so far this year. 

The rupee dropped 16% in 2018 and was one of the worst-performing currencies in Asia. 

The island nation raised $2 billion via fuve-year and 10-year sovereign bond sales last month, tapping global capital markets for the second time in three months. 

Foreign investors bought a net Rs. 2.68 billion worth of government securities in the week ended 10 July, but the market has seen a year-to-date net foreign outflow to Rs. 19.73 billion, Central Bank data showed.