Shares hit 2-week closing low; turnover down

Wednesday, 27 July 2016 00:00 - - {{hitsCtrl.values.hits}}

Reuters: Shares closed at their lowest in two weeks on Tuesday as investors sold blue-chips such as John Keells Holdings Plc even as the market awaited directions on the country’s economic policy.

The benchmark Colombo stock index ended down 0.14 percent at 6,387.85, its lowest since 11 July.

“Market is down on retail trading in thin trade as the bigger players are waiting to see the prime minister’s policy statement, while they also await directions from the Central Bank’s announcement on policy rates,” said Dimantha Mathew, Head of Research, First Capital Equities Ltd.

“We feel the rates will be unchanged, but if they push the rates up a bit, it will slow down the market.”

The Central Bank is expected to keep its key interest rates steady for a fifth straight month on Thursday, a Reuters poll showed, despite signs that inflation and private sector credit growth are picking up.

Prime Minister Ranil Wickremesinghe is expected to announce the country’s economic policy next month.

Turnover stood at Rs. 265.1 million ($1.82 million), the lowest since 5 July, and well below this year’s daily average of around Rs. 728.1 million.

Overseas investors were net sellers of Rs. 4.04 million worth of shares on Tuesday, extending the year-to-date net foreign outflow to Rs. 4.8 billion worth of equities.

Shares in conglomerate John Keells Holdings Plc fell 0.77%, while Hemas Holdings Plc dropped 3.59%, and leading fixed line telephone operator Sri Lanka Telecom Plc lost 1.54%, dragging the overall index down.