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Last Updated : 2024-04-19 00:03:00
(Colombo) REUTERS: Sri Lankan shares extended falls yesterday to a 15-month closing low as continued foreign selling in blue chips, political uncertainty and concerns about lower economic growth dented investor appetite for risky assets. The Colombo stock index declined for a 16th session in 18 and closed 0.77 percent weaker at 6,081.08, its lowest close since April 3, 2017. On Monday, the index fell the most in intraday trade in nearly 28 months. Foreign investors sold the island nation’s risky assets for a ninth consecutive session, extending the foreign outflow to Rs.1.02 billion (US$6.44 million). “Foreign selling was the main reason for the fall. Political uncertainty is the main reason that has kept investors on the sidelines,” said Prashan Fernando, CEO, Acuity Stockbrokers.
Foreign investors net sold equities worth Rs.182.8 million, extending the year-to-date foreign outflows to Rs.1.82 billion.
Turnover was Rs.566.5 million, less than this year’s daily average of Rs.932 million.
Top conglomerate John Keells Holdings closed 3.4 percent lower, Lanka Orix Leasing Company fell 4.2 percent, and leading mobile phone services provider Dialog Axiata slipped 1.4 percent.
Investors are waiting for some positive news both on the economic and political fronts, said analysts, adding that the government’s policy implementation had been sluggish since both main parties in the ruling coalition suffered local polls in February.
Finance Minister Mangala Samaraweera said last month that the economy was likely to grow about 4.5 percent this year, below a central bank estimate of 5 percent.
The International Monetary Fund (IMF) said on June 20 that Sri Lanka’s economy remained vulnerable to adverse shocks because of sizable public debt and large refinancing needs.
Ratings agency Moody’s said on Wednesday a strengthening U.S. dollar since mid-April has increased the credit risk of several emerging markets, including Sri Lanka, due to currency depreciation.
Moody’s said a strong U.S. dollar would also lead to a drop in foreign exchange reserves of countries such as Argentina, Ghana, Mongolia, Pakistan, Sri Lanka, Turkey, and Zambia.
Foreign investors net sold equities worth Rs.182.8 million, extending the year-to-date foreign outflows to Rs.1.82 billion. Turnover was Rs.566.5 million, less than this year’s daily average of Rs.932 million.
Top conglomerate John Keells Holdings closed 3.4 percent lower, Lanka Orix Leasing Company fell 4.2 percent, and leading mobile phone services provider Dialog Axiata slipped 1.4 percent.
Investors are waiting for some positive news both on the economic and political fronts, said analysts, adding that the government’s policy implementation had been sluggish since both main parties in the ruling coalition suffered local polls in February.
Finance Minister Mangala Samaraweera said last month that the economy was likely to grow about 4.5 percent this year, below a central bank estimate of 5 percent.
The International Monetary Fund (IMF) said on June 20 that Sri Lanka’s economy remained vulnerable to adverse shocks because of sizable public debt and large refinancing needs.
Ratings agency Moody’s said on Wednesday a strengthening U.S. dollar since mid-April has increased the credit risk of several emerging markets, including Sri Lanka, due to currency depreciation.
Moody’s said a strong U.S. dollar would also lead to a drop in foreign exchange reserves of countries such as Argentina, Ghana, Mongolia, Pakistan, Sri Lanka, Turkey, and Zambia.
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