Dilmah boosts Sri Lanka stocks to close 0.11-pct higher

ECONOMYNEXT – Sri Lanka stocks closed 0.11 percent higher on Wednesday amidst President Maithripala Sirisena expressing confidence that he can come to an understanding with breakaway factions, while Dilmah Ceylon Tea and Union Assurance boosted the market, brokers said.

Colombo’s All Share Price Index (ASPI) closed 6.08 points higher at 5,348.57, after moving upwards in volatile movements throughout the day.

The S&P SL20 Index of more liquid stocks closed 0.09 percent or 2.16 points down at 2,479.92.

President Sirisena said that he is confident of reaching a consensus with breakaway factions from his Sri Lanka Freedom Party such as the Sri Lanka Podujana Peramuna (SLPP) on a common presidential candidate for the upcoming election in 2019.

He said that the presidential election will be held as schedued before the end of 2019, and the exact timing will be decided by the Elections Commissioner.

The president did not rule himself out of running.

The Chief Prelate of the Asgiriya Chapter earlier in June said that Chamal Rajapaksa, brother of Former President and SLPP Leader Mahinda Rajapaksa would be president.

The market turnover on Wednesday was 128 million rupees with 53 stocks gaining and 49 stocks declining.

Foreign activity was low, with 8.1 million rupees in net outflows from the market.

Brokers said that retail investor activity was low on Wednesday.

Dilmah Ceylon Tea Company closed 45.10 rupees up at 560 rupees a share while Union Assurance ended trading 14.50 rupees up at 319.50 rupees a share, contributing most to the ASPI increase.

Central Finance Company (CFIN) closed 3.50 rupees up at 86.90 rupees a share, also pushing the ASPI up.

There were two crossings worth 43.75 million rupees in CFIN on Wednesday.

CFIN is a non-bank financial company, with its core operations in vehicle leasing.

Profits at the firm fell 6.9 percent in the March quarter as higher provisioning for bad loans due to a change in accounting standards and higher non-performing assets hit the bottom line.

Analysts say that the financial services sector is expected to be pressured in 2019 as bad loans increase and credit appetite declines amidst low growth following the Easter Sunday terror attack. (COLOMBO, 26 June, 2019- 16:17 Updated with S&P SL20 changes, foreign participants)