Bourse edges up after sell-off for IPOs

Thursday, 28 October 2010 06:36 -     - {{hitsCtrl.values.hits}}

COLOMBO  (Reuters) - Retail buyers nudged the Colombo Stock Exchange <.CSE> up on Wednesday after a two day sell-off prompted by investors marshalling funds for impending initial public offerings.

Sri Lanka’s main share index  rose 10.84 points or 0.17 percent to 6557.00. It is still Asia’s best performer in 2010 with a 93.7 percent gain as the island’s economy rebuilds after the end of a civil war in May 2009.

A power failure briefly halted trading at the bourse during on Wednesday.

It has shed 8.3 percent since hitting an all-time high of 7,207.75 on 4 October Foreign investors were net sellers of 502.9 million rupees’ worth of shares and they have sold a net 23.4 billion rupees’ worth so far this year.

The bourse is trading at the highest forward price-to-earnings ratio in Asia and global emerging markets at 19.8 times, compared with 13.6 and 12.9 respectively, Thomson Reuters data shows. The CSE’s 14-day relative strength index is at 49.05, between the neutral limits of 30 and 70.

Turnover was 1.5 billion rupees ($13.6 million), more than 2.5 times the 2009 daily average but below this year’s daily average of 2.4 billion.

The 350 million rupee IPO of Hydro Power Free Lanka was oversubscribed on its offering day, Tuesday.

The rupee edged up to 111.68/70 a dollar from Tuesday’s close of 111.70/72.