Bourse breaks 6,000-points barrier

Thursday, 9 January 2014 00:02 -     - {{hitsCtrl.values.hits}}

Reuters: Stocks gained 1.3% on Wednesday to a near five-month high and broke its psychological barrier of 6,000, led by market heavyweight John Keells Holdings PLC with foreigners buying in risky assets. Analysts said the Central Bank’s interest rate cut last week had boosted the sentiment and helped sustain the gain.The main stock index jumped 1.29%, or 77.40 points, to 6,054.47, its highest close since 22 August. Foreign investors bought Rs. 215.4 million ($1.65 million) worth of shares on Wednesday, making the year-to-date net foreign inflow at Rs. 60.8 million. They had bought a net Rs. 22.88 billion worth of stocks last year, compared with a record Rs. 38.68 billion net foreign inflow in 2011. The Central Bank slashed the standing lending facility rate or reverse repurchase rate by 50 basis points to a multi-year low of 8% on Thursday, in a move to reduce commercial banks’ interest rate spreads. On Wednesday, the yields in Government T-bills sharply fell to more than two-year low. The day’s turnover was Rs. 849.1 million, just above last year’s daily average of about Rs. 828.4 million. Shares in conglomerate John Keells jumped 3.16% to Rs. 235 a share. The CSE index gained 4.8% in 2013 after losses in the previous two years, giving a return of 2.18% in dollar terms. Many investors locked their funds in risk-free debentures instead of risky assets due to a sluggish bourse amid falling interest rates.