Stock market rebounds; rupee firmer

Thursday, 28 November 2019 03:10 - - {{hitsCtrl.values.hits}}

Reuters: Shares ended higher on Wednesday, helped by gains in beverage and banking shares, while the rupee ended firmer on hopes of tax cuts by the new Government.

After the market closed, Cabinet Spokesman Bandula Gunawardena said the Government has decided to reduce value-added tax to 8% from 15% with effect from 1 December. Sri Lanka’s Central Bank is likely to leave its key interest rates on hold at a policy review on Friday, a Reuters poll indicated, while it waits for the new Government’s economic policies after the election of a President on 16 November.

The benchmark stock index <.CSE> ended up 0.39% at 6,118.87, further moving away from its lowest close since 15 November hit on Monday. The bourse gained 1.6% last week, and is up 1.10% for the year.

Analysts said investors are awaiting for some policy directions from the country’s newly-elected President, Gotabaya Rajapaksa.

The rupee ended 0.39% firmer at 180.80/181.10 per dollar, compared to Tuesday’s close of 181.50/90, Refinitiv data showed. It is up 0.6% so far this year.

Foreign investors were net sellers for 22 sessions in 24.

They sold a net Rs. 176.7 million ($981,667) worth of shares on Wednesday, extending the net selling so far this year to Rs. 9.45 billion worth of equities, according to index data.

Equity market turnover was Rs. 1.3 billion, more than this year’s daily average of about Rs. 711.6 million. Last year’s daily average was Rs. 834 million.

Meanwhile, foreign investors were net buyers of government securities on a net basis for the fifth straight week, purchasing a net Rs. 0.21 million worth of government securities in the week ended 20 November. Total foreign outflows from government securities through 20 November stood at Rs. 48 billion, Central Bank data said.