Bourse ends at over 3-week low in thin trade

Wednesday, 9 May 2018 00:00 - - {{hitsCtrl.values.hits}}

Reuters: Shares fell on Tuesday to more than a three-week low, dragged down by shares of beverage companies such as Distilleries Company of Sri Lanka Plc, while investors continued to await fresh cues from political and economic fronts.

The Colombo stock index ended 0.33% weaker at 6,485.57, its lowest since 12 April. The index lost 0.37% last week, its second straight weekly fall.

“It was a very slow market as investors are still scared and they are worried .... they don’t see that the economy has picked up and they feel it’s still uncertain for equity investments though there are signs of improvement in the economy,” said Dimantha Mathew, head of research, First Capital Holdings.

Shares of Sri Lanka Plc ended 3.1% lower while Ceylon Cold Stores Plc fell 1.2% and Lanka ORIX Leasing Plc ended 1.9% weaker.

Conglomerate John Keells Holdings Plc ended 0.6% down and Sri Lanka Telecom Plc closed 1.1% weaker.

Analysts said depreciation of the rupee also weighed on the sentiment as it is likely to dent the profits of some listed firms that rely heavily on imports.

The rupee hit a fresh low on Wednesday on importer demand for the US currency, dealers said, but recovered after the Central Bank intervened in the market.

Fitch Ratings has said that recent political developments in Sri Lanka have created some uncertainty over reform momentum and fiscal consolidation, and prolonged upheaval could undermine investor confidence ahead of large external debt maturities in 2019-22.

Turnover stood at Rs. 601.6 million ($ 3.82 million), less than this year’s daily average of Rs. 1.03 billion.

Foreign investors bought a net Rs. 100.9 million worth of equities on Tuesday, but the market has seen a net foreign outflow to Rs. 487 million worth of equities so far this year.