Sri Lankan shares post near 3-wk closing high; Expolanka leads

COLOMBO, Feb 2 (Reuters) – Sri Lankan shares rose for a fourth straight session on Tuesday to close at their highest level in nearly three weeks, led by Expolanka Holdings after a major shareholder bought an additional 16 percent stake in the company.

Japan-based SG Holdings Global Pte Ltd acquired the stake at 8.30 rupees per share.

Expolanka shares rose as much as 6.7 percent, their biggest intraday percentage gain since Jan. 17, 2015, before settling 4 percent higher. The stock accounted for 67 percent of the day’s turnover.

Turnover was 3.89 billion rupees ($27.08 million), the highest since Dec. 10 and more than four times this year’s daily average of 875.4 million rupees.

The main stock index ended 0.99 percent higher at 6,425.96, its highest close since Jan. 14.

"It was a rebound after the January fall. The market was so bullish with the foreign buying. Most of the blue chips gained," said Dimantha Mathew, research manager at First Capital Equities (Pvt) Ltd.

The index had fallen 7.7 percent this year through Monday as foreign investors, unnerved by global concerns over China’s economy, cut their exposure.

Foreign investors bought a net 2.58 billion rupees worth of shares on Tuesday, erasing most of the year-to-date net foreign outflow, which stood at 191.7 million rupees.

Analysts, however, said a rising trend in local interest rate has been a concern and local stocks could come under further pressure.

Yields on treasury bills rose between seven and 23 basis points at a weekly auction on Tuesday, signalling a further rise in market interest rates, which move in tandem with t-bill yields.

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Shares of market heavyweight John Keells Holdings Plc rose 2 percent, while Ceylon Tobacco Company gained 3 percent.

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