Stocks dip on retail selling

Wednesday, 7 September 2011 02:10 - - {{hitsCtrl.values.hits}}

Investors take profit on speculative shares
Foreign funds net sellers of Rs. 119 m
Rupee steady despite importer dlr demand

(Reuters): Sri Lanka’s stock market fell on Tuesday in heavy volumes as retail investors took profits and institutional investors remained cautious after a two-week high in the previous session.

The island nation’s main share index lost 0.6 percent, or 41.82 points, to 6,956.21 from its highest close since 18 August. Having been Asia’s best performer this year, the decline on Tuesday clipped the bourse’s return so far down to 4.83 percent, behind Indonesia’s.

Banking and telecommunication shares pulled the market down, with losers outnumbering gainers by 150 to 62, Thomson Reuters data showed.

Non-voting and voting shares in jeweller Blue Diamonds BLUEt.CM, which had respectively jumped 122 percent and 50 percent in the previous three sessions, fell 8.47 percent and 9.76 percent.

“Retail-dominated speculative counters are getting pushed either way till we see serious buying,” said a stockbroker.

The day’s turnover was 3.24 billion Sri Lanka rupees ($29.4 million), more than last year’s average of 2.4 billion and this year’s 2.7 billion.

The bourse witnessed a foreign outflow of 119.3 million rupees on Tuesday.

After the end of a long civil war, Sri Lanka’s bourse became Asia’s best performer in 2009 and 2010, gaining 124 percent and 96 percent, respectively.

Tuesday’s total volume was 374.4 million, against a five-day average of 339.1 million and a 90-day average of 133 million. Last year’s daily average was 67.9 million.

The rupee closed steady at 110.09/10 a dollar from Monday’s close, despite heavy dollar demand from importers as a state bank through which the Central Bank directs the market sold dollars at 110.10 rupees, dealers said.

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