CSE falls for 4th straight week, ends below 6,500

Saturday, 12 August 2017 00:00 - - {{hitsCtrl.values.hits}}

Reuters –Shares fell to a more than three-and-a-half month low and breached the psychological level of 6,500 points on Friday, dragged down by diversified and beverage shares.

The market has ended lower in 10 out of the last 11 sessions through Friday, even as yields on short-term government securities fell over the past two weeks.

The Colombo Stock Index fell 0.36%, or 23.63 points, to 6,492.69, its lowest close since 19 April. The bourse fell 1.2% for the week, its fourth straight weekly fall.

“The market is coming down and there is very little foreign activity,” Softlogic Stockbrokers Deputy CEO HussainGani said.

“With the market dipping, investors are waiting for some direction.”

Foreign investors net-bought shares worth Rs. 4.9 million (about $32,026) on Friday, extending their year-to-date net inflow to Rs. 26.7 billion.

Turnover stood at Rs. 396 million, less than half of this year’s daily average of around Rs. 877.3 million.

Shares of Hemas Holdings PLC fell 3.5%, while Ceylinco Insurance PLC dropped 5%. Colombo Cold Stores PLC ended 1.5% weaker, Sampath Bank PLC ended 1.4% down and conglomerate John Keells Holdings PLC fell 0.5%.

Analysts expect equities to reverse the downtrend, helped by a fall in government bond yields.

Short-term treasury-bond yields fell between 10 basis points (bps) and 16 bps at a weekly auction on Wednesday, while the yields on a 59-month bond dropped by 99 bps and that on a 118-month bond fell by 78 bps at the last week auction.