Rupee extends gains; stocks rebound from 6-year low

REUTERS: The Sri Lankan rupee closed stronger on Thursday due to dollar inflows from inward remittances ahead of the traditional New Year celebrations, market sources said, while stocks snapped an eight-session losing streak to end higher. 

The currency extended gains into a third session to end firmer at 176.10/25 to the dollar, up from Wednesday’s close of 176.20/40. 

The rupee has climbed 1.1% so far this week and 3.7% this year as exporters converted dollars and foreign investors purchased government securities amid stabilising investor confidence after the country repaid a $1 billion sovereign bond in mid-January. 

Dealers expect pressure on the currency to ease with more inward remittances ahead of the traditional Sinhala-Hindu New Year on 14 April.

The Colombo Stock Exchange index ended 0.81% firmer at 5,556.28 on Thursday, edging up from their lowest since 18 December 2012, hit in the previous session. 

The benchmark stock index slipped 1.36% last week, recording its seventh consecutive weekly drop. The index has declined 8.2% so far this year. 

The market awaits for some positive news from the third and final vote on the 2019 Budget, scheduled for 5 April, market sources said. 

Turnover was Rs. 457.8 million ($2.60 million), less than this year’s daily average of Rs. 656.6 million. Last year’s daily average came in at Rs. 834 million. 

Foreign investors sold a net Rs. 46.8 million worth of shares on Thursday, extending the year-to-date foreign outflows to Rs. 6.21 billion worth of equities so far this year.