Stock market soars to 7-month high on retail buying

Saturday, 27 April 2013 01:44 - - {{hitsCtrl.values.hits}}

Reuters: Shares hit a seven-month high on Friday, breaking the psychological barrier of 6,000 level, helped by retail investor buying on hopes interest rates will ease, while the rupee closed firmer on dollar sales by State banks.

The main stock index rose for a third straight session to close 0.48%, or 28.44 points, up at 5,962.17, its highest close since 1 October 2012. It rose to as high as 6,005.66 in intraday trading.

Shares have been rising on hopes of a fall in interest rates after Treasury Secretary P.B. Jayasundera and the Central Bank said official interest rates could ease in May and June.

“Retail activities were high on expectations that the interest rates will come down. That pushed the market up,” said a stockbroker.

The turnover was Rs. 1.34 billion ($ 10.57 million), more than this year’s daily average of Rs. 966 million.

Foreign investors were net buyers of Rs. 327.6 million worth shares, extending the net foreign inflow so far this year to Rs. 8.59 billion. Last year, the bourse saw a net inflow of $ 303 million.

The rupee ended slightly firmer at 126.77/80 per dollar from Wednesday’s close of 126.85/90, ending its seven-session falling streak and edging up from its lowest close since 11 March, as State banks sold dollars, currency dealers said.

Markets were closed on Thursday for a religious holiday.