Stocks slips from 3-year high

Thursday, 28 August 2014 00:00 - - {{hitsCtrl.values.hits}}

Reuters: Stocks slipped on Wednesday, retreating from a three-year high hit on Tuesday, led by illiquid shares in low trade, with retail profit-taking in speculative shares, brokers said. The Bourse hit a three-year high on Tuesday, helped by the low interest rates and analysts said an increase in speculative trading in fundamentally weak shares could dent the healthy growth the index has seen this year. The main stock index ended down 0.41%, or 28.41, at 6,984.91, slipping from its highest close since 18 August 2011 hit on Tuesday. The index has gained 18.13% so far this year.“The market was brought down by the illiquid shares in low trade while we have seen some retail profit-taking in speculative counters,” said Dimantha Mathew, Manager Research at First Capital Equities. The index plummeted more than 20% after it hit a record peak in February 2011 mainly due to speculative trading. Analysts said the market is struggling to hold above 7,000 points its psychological barrier which turned it to a technical barrier now. Good Hope Plc, which led the overall fall in the index, fell 23.86% to Rs. 1,500 in one share trade, while Lion Brewery (Ceylon) Plc fell 5.02% to Rs. 606. Wednesday’s turnover stood at Rs. 742 million ($5.70 million), its lowest since 28 July and well below this year’s daily average of Rs. 1.2 billion. Foreign investors were net sellers of Rs. 2.91 million worth of shares on Wednesday, but they have been net buyers of Rs. 8 billion so far this year. The Central Bank rejected all 91-day Treasury bill bids at an auction for the second straight week, while the yields in the 182-day and 364-day Treasury bills held steady at a weekly auction on Wednesday.

Rupee erases early gains, ends steady

Reuters: The rupee ended steady on Wednesday erasing early gains as late importer dollar demand offset exporter greenback sales while dealers expect the local currency to remain steady for the rest of the year after positive comments by the Central Bank Chief last week. Central Bank Governor Ajith Nivard Cabraal said last week the banking regulator would intervene in the thinly-traded market whenever needed to keep the rupee stable. The rupee ended at 130.20/22 per dollar, unchanged from Tuesday’s close. “Importer (dollar demand) came in the latter part of the day,” a currency dealer said. Foreign investors bought a net Rs. 1.81 billion ($ 13.9 million) worth of Government securities in the week ended 20 August, official data showed. The People’s Bank of China on Monday said it would allow the Central Bank of Sri Lanka to invest in the country’s interbank bond market. The Central Bank in a statement said the agreement with the People’s Bank of China will enable the bank to further diversify its reserves management activities into Chinese renminbi-denominated assets.