Stocks edge up from near 11-week low amid foreign buying

Wednesday, 30 September 2015 00:08 -     - {{hitsCtrl.values.hits}}

Reuters: Shares ended Tuesday slightly firmer from the previous session’s 11-week low, snapping a losing streak over three straight sessions, helped by foreign buying of blue chips.

Foreign investors were net buyers of Rs. 40.3 million worth of shares on Tuesday, but they have been net sellers of Rs. 3.07 billion worth of shares this year.

The main stock index closed up 0.1%, or 6.74 points firmer, at 7,085.38, edging up from its lowest close in nearly 11 weeks in the previous session.

“The market was pushed up on low volumes. But the buying is not that prevalent,” said Dimantha Mathew, a research manager at First Capital Equities Ltd. “Still investors are largely waiting for the Government’s policy direction and budget.”

Shares of Nestle Lanka Plc rose 3.96% while Sri Lanka Telecom Plc rose 2.30%.

Turnover was Rs. 816.3 million ($5.78 million), less than this year’s daily average of 1.11 billion. Turnover has been roughly half of this year’s daily average since 31 August, stock exchange data showed.

On Monday, the Central Bank Chief said he would not rule out a possible rate hike if credit grew faster.


Rupee ends steady on State bank dollar sales

Reuters: The rupee ended steady on Tuesday as a State-run bank sold dollars to offset importer demand for the greenback, a day after the currency hit a record low.

The rupee ended steady at 141.25/30 per dollar, compared with Monday’s close. The spot currency fell 0.3% to touch a record low of 141.40 on Monday, surpassing its previous all-time low of 141.00 hit on 22 September.

“There was importer (dollar) demand. But the rupee ended steady as a state bank sold (dollars) at 141.25,” said a currency dealer, asking not to be named. “The rupee is still under pressure as there are no real dollar inflows.”

Central Bank Governor Arjuna Mahendran said on Monday the rupee is “fairly valued” and expected it to stabilise only after a rate increase by the US Federal Reserve, likely by year-end.

The rupee has fallen 4.7% since the Central Bank effectively floated it on 4 September.

The rupee float has won a thumbs-up from rating agencies and economists, but more reforms will be needed to support the currency and conserve the Central Bank’s modest reserves. The Central Bank on 15 September imposed a 70% limit on loans and advances for vehicles, a move seen aimed at curbing demand for credit and stemming dollar outflows.