31 October 2019 10:50 am
(Colombo) REUTERS: Sri Lankan shares slipped yesterday after nine straight sessions of gains to a 13-week closing high, while the rupee closed slightly weaker.
The benchmark stock index ended 0.12 percent weaker at 5,957.27, slipping from its highest close since July 29 hit on Tuesday. The index rose 1.2 percent last week and 2.2 percent in the previous nine sessions but is down 1.57 percent for the year.
Beverage stocks were among the top losers, with Nestle Lanka PLC shedding 2.3 percent, Distillers Company of Sri Lanka PLC down 1.7 percent and Commercial Bank PLC declining 0.82 percent.
Investors are cautious ahead of presidential election next month. Presidential candidate Gotabaya Rajapaksa released his election manifesto on Friday pledging a tax overhaul that would reduce tax to 8 percent from the current 15 percent, abolish a tax for professionals and simplify many other taxes.
Rajapaksa faces a stiff challenge from Housing Minister Sajith Premadasa, who will announce his policy framework on Thursday. Analysts said investors were waiting for Premadasa’s policies to assess the possible impacts on tax, subsidies and private businesses.
The rupee ended 0.03 percent weaker at 181.50/60 per dollar, compared with Tuesday’s close of 181.45/65. The currency is up 0.6 percent so far this year.
Foreign investors were net sellers of riskier assets for the sixth straight session yesterday.
They sold net Rs.48 million worth of shares, extending the year-to-date net foreign selling to Rs.4.22 billion of equities, according to index data.
Equity market turnover was Rs.651.97 million, in line with this year’s daily average of about Rs.664.6 million rupees. Last year’s daily average was Rs.834.0 million rupees.
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 October 23.
Total foreign outflows from government securities through October 23 stood at Rs.53.63 billion, according to the Central Bank data. Sri Lanka’s Central Bank left its key rates unchanged on October 11 after loosening policy earlier this year, although growth is likely to remain subdued as the economy faces rising global risks.