Stocks extend rally on banks, hotels

Saturday, 28 January 2012 01:47 - - {{hitsCtrl.values.hits}}

Reuters: Sri Lanka’s share market extended its rally with a more than two per cent gain on Friday as investors snapped up risky assets after market heavyweight and bellwether John Keells Holdings posted strong earnings.

The main share index rose 2.38 per cent or 133.04 points to 5,725.44, highest since 23 January. It has risen 3.04 per cent in last two sessions.

Foreign investors booked profits while local institutional investors bought blue chips like Commercial Bank of Ceylon, which rose four per cent to Rs. 104 on foreign selling of 2.2 million shares.

The Bourse returned to neutral territory with the Relative Strength Index at 41.210 from Thursday’s oversold region of 27.965, in between the lower neutral range of 30 and upper neutral range of 70, Reuters data showed. But it is still the worst performer among Asian markets with a 5.75 per cent loss so far this year. It was 10th best in 2011, after being on top in 2009 and 2010.

Net foreign sales on Friday were Rs. 157.3 million, but offshore investors are net buyers of 751.2 million so far this year, after net outflows of 19.1 billion last year and a record 26.4 billion in 2010. Conglomerate Aitken Spence PLC rose 3.2 per cent to Rs. 113, a day after it said that it would realise a capital gain of Rs. 630 million on the sale of its 30 per cent stake in the Colombo Harbour container terminal joint venture.

Keells gained 2.75 per cent to Rs. 167.90, a day after it posted a 56 per cent gain in its December quarter earnings.

The day’s turnover was Rs. 1.61 billion ($ 14.13 million), less than last year’s average of 2.3 billion. Volume was 59.1 million shares. Last year’s daily average was a record 102.7 million.

The rupee closed flat at 113.89/90 to the dollar for a 45th straight session since a 21 November devaluation with the Central Bank selling around $6 million to defend it, dealers said.

The bank has spent more than $ 1.07 billion keeping the exchange rate steady since 21 November. It spent a net $ 1.79 billion in the first 10 months of last year to keep depreciation at bay.