Shares hit more than 13-week closing low

REUTERS: Sri Lankan shares fell for a sixth straight session yesterday, their lowest close in more than 13 weeks, led by losses in hotels and diversified stocks.

The Colombo stock index fell 0.21 percent to 6,571.48, its lowest close since May 3. The index slipped 1.6 percent in July, but has risen about 6 percent this year as of close of trade on July 31.
Shares of conglomerate John Keells Holdings Plc dropped 0.8 percent, while Trans Asia Hotel Plc fell 4.9 percent and Melstacrop Plc ended 1.67 percent weaker.

“Lack of foreign buying on the big counters dragged (down) the index,” said Hussain Gani, deputy CEO of Softlogic Stockbrokers. 

“Foreigners are looking at the market positively, but the market did not have a spark today to boost sentiment.”

Foreign investors net bought shares worth Rs.112.9 million yesterday, extending their year-to-date net inflow to 26.5 billion rupees.

Turnover stood at Rs.381.4 million (US$2.49 million), its lowest since July 26 and well below this year’s daily average of around Rs.893.3 million.

Sri Lanka’s Central Bank held policy rates steady before market hours yesterday, and said tightening measures taken in the past are helping cool inflation and credit growth.

Investors in fixed-income assets may shift to equities as government bond yields are falling, analysts said.

Short-term treasury-bond yields fell between 41 basis points (bps) and 55 bps at a weekly auction on Wednesday.

In last week’s auction, the weighted average yield on a 59-month bond dropped by 99 bps, while that on a 118-month bond fell by 78 bps.