Sri Lankan shares ease; interest rate concerns weigh
Mar 07, 2017 18:23 PM GMT+0530 | 0 Comment(s)
COLOMBO, March 7 (Reuters) - Sri Lankan shares ended slightly weaker on Tuesday, with financial and manufacturing stocks dragging down the index as investor sentiment continued to remain low on concerns about rising interest rates.
The Colombo stock index ended down 0.15 percent at 6,108.11, On Friday the bourse hit its lowest close since Feb. 9. It shed 0.6 percent last week in its second straight weekly decline.
Foreign investors were net buyers of shares worth 379.6 million rupees ($2.51 million) on Tuesday, extending the year-to-date net foreign inflow to 1.73 billion rupees worth of equities.
Turnover was 539 million rupees, less than this year's daily average of 676.9 million rupees.
"Retail and institutional segment is on silent (mode) with the high interest rates and economic uncertainty," said Dimantha Mathew, head of research, First Capital Equities (Pvt) Ltd.
The International Monetary Fund on Tuesday urged Sri Lanka's central bank to rebuild international reserves, while maintaining exchange rate flexibility, and to be ready to tighten monetary policy if credit growth or inflation do not abate.
Shares in Ceylon Cold Stores Plc fell 2.51 percent while Commercial Leasing & Finance Plc lost 6.67 percent.
Yields on treasury bills have risen to a more-than-four-year high since October, while the central bank has kept key policy rates on hold.