Shares down on Libya, month-end settlements

Reuters: Sri Lanka’s stock market fell on Tuesday for a second session to near a two-week low as investors sold shares for month-end settlements and revolts in the Middle East and North Africa spurred other selling, traders said.

Analysts said the crises in Libya and elsewhere weighed on the bourse on concerns over higher oil prices, possible job cuts for Sri Lankans working in the Gulf and a likely hit on tea exports. Investors globally have been scaling down exposure, as oil prices have surged with the string of popular revolts.

The island’s main share index fell 1.34 per cent or 102.45 points to 7,514.74, lowest since 10 February. It hit a record closing high of 7,811.82 on 14 February.



Foreign investors sold a net 188.5 million rupees on Tuesday, extending the total net foreign outflow to Rs. 6.4 billion in 2011, after selling a record net 26.4 billion in 2010.

The bourse has still been Asia’s best performer with a 13.2 per cent gain in 2011 after being in the region’s top spot with a 96 per cent return last year.

Turnover was Rs. 2.1 billion ($ 19.2 million), less than last year’s average of Rs. 2.4 billion and this year’s daily average of Rs. 3.8 billion.

Traded share volume was 48.7 million, against a five-day average of 64.4 million. The 30-day and 90-day average trading volumes were 149.4 million and 68.1 million respectively. Last year’s daily average volume was 68.9 million.

The bourse is trading at a forward price-to-earnings (P/E) ratio of 16.6, one of the highest among emerging markets, compared with 13.1 in Asian markets and 11.9 in global emerging markets, Thomson Reuters StarMine data showed.

The rupee closed flat at 110.87/110.89 a dollar, as a State bank sold dollars at 110.90, dealers said.