Shares at 8-wk high; hopes on earnings, political stability help

REUTERS - Sri Lankan shares rose to an eight-week high yesterday, gaining for a third straight session, as hopes of improved corporate earnings and political stability after the parliamentary polls next month boosted investor sentiment.

At 0615 GMT, the main stock index was up 0.48 percent at 7,247.09, its highest level since May 29.

Turnover stood at Rs.633.2 million ($4.74 million) in early trade yesterday. “The market has been up on positive sentiment on the elections and expectations over a strong government after the elections,” said Reshan Kurukulasuriya, chief operating officer of Richard Pieris Securities (Pvt) Ltd.

“Next week we could see some dip with month-end settlements. But overall it’s positive sentiment.”

Analysts also expect Sri Lankan companies to post strong results for the April-June quarter. Hopes of political stability after the Aug. 17 parliament election also helped sentiment, they said.

The election is expected to help strengthen President Sirisena’s political position with a possible victory for the current ruling coalition. The Sri Lankan rupee was steady in dull trade as a state-owned bank maintained its dollar-selling rate at 133.70, dealers said.

“It is a very dull market. There are no bids or offers. The rupee is steady as the state bank is selling at 133.70,” a currency dealer said.