Stocks hit 6-month low on rupee; Large-caps drag

Saturday, 7 September 2013 00:00 - - {{hitsCtrl.values.hits}}

Reuters: Stocks weakened for a fifth straight session on Friday to touch a six-month closing low, with shares in large-caps such as Ceylon Tobacco Plc leading the fall amid concern over rupee depreciation, traders said. The main share index fell 0.25%, or 14.35 points, to close at 5,672.64, its lowest close since 6 March. It has fallen 2.8% over the last five sessions, mainly due to concerns over the rupee which hit a record low last week. “The rupee depreciation will not encourage any foreigners to invest in shares. It will also increase the cost of many companies as most of the inputs are imported,” a stockbroker said. The rupee traded little changed on Friday and dealers said the Central Bank had directed the market not to trade the currency beyond a certain level, but it remained under downward pressure. The currency had hit an all-time low last week on panic buying by importers, but has recovered since then. The Bourse is at an oversold territory, with the 14-day Relative Strength Index on Friday at 25.688, below its lower neutral level of 30, Thomson Reuters data showed. Shares in Ceylon Tobacco fell 3.79% to Rs. 1,116.60, while top conglomerate John Keells Holdings Plc fell 0.57% to Rs. 209.40. Friday’s turnover was Rs. 249.3 million ($ 1.87 million), less than a third of this year’s daily average of about Rs. 889.6 million. Foreign investors were net sellers for the third straight session, selling Rs. 3.38 million worth of shares, but they have been net buyers of Rs. 18.49 billion in stocks so far this year.

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