Bourse stays on the up; rupee weaker

Reuters: Sri Lankan shares edged up on Wednesday led by retail investor buying into market heavyweight John Keels Holdings, while the rupee fell on importer demand for dollars, traders said.

The Colombo Stock Exchange’s main index edge up 0.37 percent or 18.77 points to 5,078.06, its highest since May 22. It has gained 5.6 percent in the last six sessions.

“The market is on a bit of a retail run today. We saw retail participation and very little foreign activities,” said a stockbroker on condition of anonymity.

The market heavyweight and top conglomerate John Keells Holdings gained 1.73 percent to 194.00 rupees, pushing up the overall index. Another favorite for retail investors, HVA Foods, jumped 8. 5 9 percent to 13.90 rupees a share, which some analysts attributed due to speculative buying.

But trading was thin as institutional investors stayed out of the market because of concerns over sluggish economic growth, rising interest rates, and a volatile rupee currency.

The day’s turnover was 616.6 million rupees ($4.65 million), below the daily average of 929.1 million rupees this year.

On Wednesday, both 182- and 364-day T-bill yields rose to two-year high of 12.47 percent and 12.78 percent respectively at a weekly auction.

The rupee fell for a third straight session to 132.70/80 against the dollar from Tuesday’s close of 132.50/70 on importer dollar demand, dealers said. It hit a record low of 133.60 on June 12.

Last week, Treasury Secretary P.B. Jayasundera told Reuters the rupee had hit its low and would stabilise around 125 per dollar in the medium term.