Stock market at 1-week high; retail investors buy blue chips

Thursday, 22 October 2015 00:00 - - {{hitsCtrl.values.hits}}

Reuters: Shares ended at more than one-week high on Wednesday, led by blue chips as retail and high-net-worth investors returned to the market, but foreign investors turned cautious ahead of the Government’s key policy statement.

The main stock index ended 0.2%, or 14.41 points, firmer at 7,055.67, its highest close since 13 October.

“We see the market slowly strengthening, with retail and high-net-worth investors buying into the market,” said Dimantha Mathew, a research manager at First Capital Equities Ltd.

“Foreigners are on the selling side and the institutional and others are silent ahead of the Government’s policy statement and the Budget,” he said. Analysts said investors were cautious ahead of Prime Minister Ranil Wickremesinghe’s policy statement scheduled early next month outlining the Government’s economic priorities ahead of the 2016 Budget announcement scheduled on 20 November. The Prime Minister will deliver the policy statement on 5 or 6 November, said Finance Minister Ravi Karunanayake while speaking at a public forum late on Monday. Analysts said a Government move to implement a Budget proposal of a retrospective tax targeting corporate is the main concern for investors.

Turnover stood at Rs. 1.06 billion ($7.5 million), in line with this year’s daily average of Rs. 1.1 billion. Foreign investors were net sellers of Rs. 12.4 million worth of shares on Wednesday, extending the year-to-date net foreign outflow to Rs. 2.93 billion worth of equities. Shares of Ceylon Tobacco Co Plc rose 0.78%, while conglomerate John Keells Holdings Plc gained 0.35%.