Reuters: Stocks ended weaker for the third straight session on Tuesday, easing to a three-month low as high interest rates weighed on sentiment with investors dumping risky assets to shift to high-yielding Government securities.
The Colombo Stock Exchange’s main index ended 0.12 per cent or 6.26 points, weaker at 5,331.45, its lowest close since 4 September. The index has now fallen to the over-sold region, Thomson Reuters data showed.
“Negative sentiment will continue until interest rates come down,” said a broker who declined to be identified.
The yield for 364-day T-bills gained for a seventh consecutive week at an auction on Wednesday. Analysts say investors have been shifting to fixed deposits from equities since the Central Bank kept key policy rates at three-year highs on 9 November.
The day’s turnover was Rs. 505.5 million ($ 3.90 million), well below this year’s daily average of Rs. 898.5 million. Foreign investors bought a net Rs. 156.4 million worth of shares, extending the net foreign inflow this year to Rs. 35.6 billion.
The index fell to an over-sold territory on Tuesday with the 14-day relative strength index falling to 29.975, below the lower end of the neutral range of 30.
The rupee closed firmer at 128.30/40 to the dollar compared with Monday’s close of 129.30/35 on foreign inflow into a foreign bank, dealers said.