Stocks hit 3-mth closing high led by banks, construction shares

REUTERS: Sri Lankan shares hit a three-month closing high yesterday as investors bought banking and construction stocks, brokers said.

Construction shares have been rising ever since the government gave its consent to restart a $1.4 billion port city deal on hopes the sector would see a boom, brokers said.

Sri Lanka’s government on Aug.12 agreed on a new version of its $1.4 billion real estate agreement with China after changing the terms and blocking the outright sale of land - part of a project covering a square mile right next to the capital’s port.

The benchmark Colombo stock index ended 0.14 percent higher, or 8.99 points, at 6,602.24, its highest close since May 20.

The index rose 1.23 percent this week, its third straight week of gains.

“Today the market is up on the bullish buying interest in the construction sector,” said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

“There could be some profit-taking but we don’t see huge downside, with investor confidence improving on the overall economy.”

Turnover stood at Rs.1.45 billion ($9.97 million), nearly double this year’s daily average of around Rs.743.8 million.

Foreign investors net sold Rs.265.9 million worth of shares yesterday, extending the year to date net foreign outflow to Rs.3.27 billion ($20.63 million) worth equities.

They have however net bought Rs.1.38 billion worth of shares so far this month.

Shares of Dialog Axiata Plc jumped 2.65 percent, while Access Engineering Plc rose 2.81 percent and DFCC Bank Plc climbed 2.26 percent.