Bourse edges down to one-week low; Keells leads

Friday, 20 June 2014 00:43 - - {{hitsCtrl.values.hits}}

Reuters: Shares edged down to hit a one-week closing low on Thursday in moderate volume, led by a fall in shares of market heavyweight John Keells Holdings. However, analysts said the index would be on a slow rising trend this year due to lower interest rate. The main stock index fell 0.07% or 4.41 points to 6,313.20, its lowest since 11 June. It hit a more than one-year high on Tuesday. “We expect the index to gain this year due to lower interest rates,” said Danushka Samarasinghe, Chief Operating Officer at Softlogic Finance. “But the gain will be slower and sticky because we don’t see a growth in profits in businesses.” The bourse saw a net foreign inflow of Rs. 105.9 million, extending the inflows to Rs. 5.92 billion ($ 45.47 million) so far this year. The market has been on a rising trend since late February due to the continued foreign buying and lower interest rates. It fell on Wednesday after the Central Bank held the key policy rates steady, though some had expected a rate cut. Dealers said investors were waiting to see the impact of weekend violence that killed at least three people and left 75 people seriously injured on the market and tourism sector. The Central Bank has reduced its key policy rates to multi-year lows, but has not yet seen any improvement in credit and import growth. April private sector credit growth contracted 3.3% year-on-year, its worst performance since January 2010. Turnover was Rs. 683.6 million, less than this year’s daily average of Rs. 1 billion. Shares of Conglomerate John Keells fell 2.20% to Rs. 222.10.

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