Investment in Sri Lanka

Sri Lankan shares rise for 3rd session on foreign buying, window dressing

FIRST CAPITAL’S HEAD OF RESEARCH, DIMANTHA MATHEW, SPEAKS TO REUTERS

Thu Mar 30, 2017

Sri Lankan shares rose for a third straight session on Thursday, closing at their highest in more than one week, helped by foreign investor buying and quarter-end window dressing, stockbrokers said.

The Colombo stock index closed 0.31 percent firmer at 6,040.18, its highest close since March 21.

On Monday, it had closed at its lowest since March 15, 2016 after the central bank tightened its monetary policy on Friday by 25 basis points to contain high inflationary expectations.

Stockbrokers said rising interest rates have kept most investors on the sidelines. Yields on treasury bills rose 6-16 basis points at a weekly auction on Wednesday.

“Local buying demand is increasing and the market is moving up on blue chips. Buying interest from the retail side is slowly improving,” said Dimantha Mathew, head of research, First Capital Equities (Pvt) Ltd.

“Local buying interest has now started to improve but the foreign side is still dominating.”

Foreign investors net bought shares worth 200 million rupees ($1.32 million) on Thursday, raising the year-to-date net foreign inflow to 4.58 billion rupees in equities.

Turnover stood at 1.18 billion rupees, well above this year’s daily average of 718.3 million rupees.

Shares of Nestle Lanka Plc jumped 4.46 percent, Ceylon Theatres Plc rose 10.30 percent, Ceylon Cold Stores Plc gained 0.82 percent, and Commercial Bank of Ceylon Plc, the country’s biggest listed lender, ended up 0.93 percent.

($1 = 151.8500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

The comments on this report are provided by the Capital Markets Research Unit of First Capital Holdings PLC an investment bank in Sri Lanka.

The company operates in the capital markets of Sri Lanka in government securities – treasury bills and bonds, stock brokering and share market investments, asset management, private wealth management,  retirement planning, personal financial planning, unit trust, margin trading, capital market research, trustee services, corporate finance advisory services including corporate debt structuring (debentures, trust certificates, commercial papers), valuations, restructuring, mergers and acquisitions, initial public offerings (IPOs) and project advisory.

The First Capital Group consists of First Capital Treasuries PLC, First Capital Limited, First Capital Markets Limited, First Capital Asset Management Limited and First Capital Equities (Private) Limited covering Colombo, Negombo, Matara, Kandy and Kurunegala.