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Sri Lanka rupee nears 159 to the US dollar, stocks fall 0.57-pct

ECONOMYNEXT – The Sri Lanka rupee fell to a new low of 158.85/95 rupees against the US dollar on Thursday, while stocks closed 0.57 percent lower amidst foreign selling in John Keells Holdings and CT Holdings, dealers and brokers said.

The rupee neared 159 rupees against the US dollar in the spot market Friday on importer demand, closing at a new low of 158.85/95 rupees against the greenback, dealers said. The US dollar closed Tuesday at 158.70/80 rupees.

Dealers said export conversions prevented the dollar from crossing over 159 rupees with monetary authorities not intervening in the market.

Money markets continued to be short at 14.54 billion rupees on Thursday, up from 13.3 billion rupees the previous day.

On May 30, the central bank sold down 15 billion rupees of its treasury bill holdings which took out cash from the system. Dealers said low liquidity tends to contain importer demand.

The Central Bank injected 13 billion rupees via a reverse repo auction on Thursday to meet the liquidity shortfall, up from 10 billion rupees the previous day.

Well-managed banks with excess liquidity deposited 13.5 billion rupees in the central bank’s excess liquidity window, while banks that were short had to borrow 15 billion rupees from the central bank reverse repo window at 8.50 percent.

In gilts, a five-year bond maturing in 2023 closed at 10.38/44 percent in two way quotes, up from 10.38/42 percent the previous day.

A ten-year bond maturing in 2028 eased to 10.57/67 percent, down from 10.60/70 percent the previous close.

In equities, the Colombo All Share index fell 0.57 percent, down 36.29 points to 6,363.62, and the S&P SL20 of more liquid stocks closed 0.58 percent lower, down 20.68 points to 3,557.76.





Market turnover was 545.7 million rupees, up 7 percent from the previous day.

Lanka Orix Leasing (down 4.10 rupees to 110 rupees), Distilleries (down 40 cents to 21.60 rupees) Chevron Lubricants (down 7.10 rupees to 74.80 rupees) and John Keells Holdings (down 1.20 rupees to 156.80 rupees) contributed to the benchmark index decline.

Net foreign selling was 114.3 million rupees, compared to buying of 188.4 million rupees the previous day.

Foreign selling in CT Holdings was 51 million rupees followed by 35 million rupees in John Keells Holdings, according to First Capital Research.

Crossings, or off-market negotiated trades, amounted to 71.2 million rupees, accounting for 13 percent of market turnover.

There was one crossing each in CT Holdings at 47.2 million rupees and John Keells Holdings at 24 million rupees. (COLOMBO, 7 June, 2018)

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