30 October 2019 12:01 am
REUTERS - Sri Lankan shares closed at 13-week highs yesterday led by financial and diversified stocks, while the rupee closed weaker on dollar demand from importers.
Presidential candidate Gotabaya Rajapaksa released his election manifesto on Friday pledging a tax overhaul that would reduce the value-added tax to 8 percent from the current 15 percent, abolish a tax for professionals and simplify many other taxes.
Rajapaksa faces a challenge from Housing Minister Sajith Premadasa, who will announce his policy framework on Friday. Analysts said investors were waiting for Premadasa’s policies to assess the possible impacts on tax, subsidies and private businesses.
The benchmark stock index rose for a ninth straight session, closing 0.31 percent higher at 5,964.25, its highest since July 29. The index posted a weekly gain of 1.2 percent last week, but is down 1.46 percent so far this year.
Shares in Carsons Cumberbatch Plc rose 7.9 percent, while Dialog Axiata Plc ended up 0.8 percent and LOLC Holdings Plc closed 1.96 percent firmer.
The rupee ended 0.06 percent weaker at 181.45/65 per dollar, compared with Monday’s close of 181.35/60. The currency is up 0.63 percent so far this year.
Foreign investors were net sellers of riskier assets for the fifth time in eight sessions.
They sold net Rs.11 million (US$ 60,512) worth of shares, extending the year-to-date net foreign selling to Rs.4.17 billion of equities, according to index data.
Equity market turnover was Rs.639.7 million, less than this year’s daily average of about Rs.664.6 million. Last year’s daily average was Rs.834million.
Meanwhile, foreign investors bought government securities on a net basis for the first time in three weeks, buying a net Rs.1.97 billion worth of government securities in the week ended Oct. 23.
Total foreign outflows from government securities through Oct. 23 stood at Rs.53.63 billion, according to Central Bank data.
Sri Lanka’s Central Bank left its key rates unchanged on Oct. 11 after loosening policy earlier this year, although growth is likely to remain subdued as the economy faces rising global risks.