Sri Lankan shares post near four-month closing high; telcos lead

COLOMBO, May 6 (Reuters) – Sri Lankan shares rose for a second straight session on Friday to hit their highest close in about four months, led by telecom stocks amid foreign investor buying.

However, the gains were capped as investors were worried that the island government’s move to increase value-added tax (VAT) and impose new taxes effective from Monday would hit company bottomlines.

The benchmark stock index rose 0.21 percent to 6,592.45, its highest closing level since January 11. For the week, it gained 1.2 percent, its fifth straight weekly rise.

"It looks like the market is continuing to move up at a slow pace with some foreign selling pressure on big-cap shares," said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

"High interest rates and earnings yet to be released will have an impact on the market."

Foreign investors who have sold equities worth Rs2.88 billion ($19.84 million) so far this year were net buyers for the second straight session on Friday. They bought a net Rs71.7 million worth of shares.

Turnover stood at Rs701.2 million, less than this year’s daily average of around Rs777 million.

Leading fixed-line phone operator Sri Lanka Telecom Plc jumped 6.03 percent, while conglomerate John Keells Holdings Plc rose 0.58 percent.
(Colombo/May 06 2016)

 

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