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Sri Lankan shares hit near 4-week closing low on foreign selling

ATCHUTHAN SRIRANGAN, ASSISTANT  MANAGER – RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

AUGUST 08, 2018

COLOMBO, Aug 7 (Reuters) – Sri Lankan shares declined for a second straight session on Tuesday and posted their lowest close in nearly four weeks, as foreign investors sold stocks such as conglomerate John Keells Holdings Plc, brokers said.

The Colombo stock index ended 0.41 percent lower at 6,117.63, its lowest close since July 11, and has declined about 4 percent so far this year.

Turnover rose to the highest since May 31, at 2.1 billion rupees ($13.15 million), well above this year’s daily average of 849 million rupees.

“Market was dragged down by foreign selling of blue chips. A foreign fund is exiting as part of its selloff,” said Atchuthan Srirangan, assistant manager – research, First Capital Holdings Plc.

Foreign investors sold equities worth a net 983.4 million rupees, extending the year-to-date net foreign outflow to 3.5 billion rupees worth of equities.

Sri Lanka’s central bank left its key policy rates unchanged as expected on Friday and said the decision backed its goals for stabilising inflation and fostering sustainable economic growth.

Central bank Governor Indrajit Coomaraswamy said the economy was unlikely to grow more than 4 percent in 2018, falling short of an earlier estimate of 5 percent.

Shares of John Keells, which accounted for 50.8 percent of the day’s turnover, ended 1.1 percent lower with foreign investors selling 7.5 million shares of the company.

Ceylon Tobacco Co Plc fell 1.7 percent, Hatton National Bank Plc declined 1.3 percent and Melstacorp LTD closed 2 percent weaker. ($1 = 159.6500 Sri Lankan rupees) (Reporting by Ranga Sirilal; Editing by Subhranshu Sahu)