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Friday May 14th, 2021
Markets

Sri Lankan shares fall to near 3-week low

COLOMBO, May 29 (Reuters) – Sri Lankan shares ended near a three-week low on Friday led by large-caps and foreign selling in blue-chips while investors cautiously bought the island nation’s risky assets due to political uncertainty ahead of a parliament poll.

The main stock index ended 0.49 percent weaker at 7,220.29, near its lowest close since May 11.

Foreign investors sold a net 188.4 million rupees ($1.41 million) worth of shares on Friday, extending foreign outflows to 1.49 billion in the last four sessions. But the bourse has seen net inflows of 4.45 billion rupees in equities so far this year.

Turnover was 1.26 billion rupees, higher than this year’s daily average of about 1.14 billion rupees.

Political uncertainty due to the Ranil Wickremesinghe-led government not having a majority has been a drag on the market, though the trend reversed after the central bank cut key monetary policy rates to record lows on April 15.

The index has gained 4.6 percent since the rate cut.

Large-cap Ceylon Tobacco Company fell 3.3 percent while market heavyweight John Keells Holdings and top lender Commercial bank of Ceylon lost 2.5 percent and 0.8 percent respectively on foreign selling.

President Maithripala Sirisena’s government has said it would dissolve parliament once some crucial reform bills are passed. But it has not scheduled the date for the election.

Analysts say investors hope a new stable government after the election coupled with strong economic measures would boost confidence.

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