Stock market recovers, Ceylon Tobacco up on foreign buying

Reuters: Shares rose yesterday after two straight sessions of decline, helped by gains in Ceylon Tobacco Co on foreign investor buying.

But turnover was low due to lower participation of local retail and institutional investors, dealers said.

The Colombo Stock index ended 0.35% firmer at 6,440.77.

Shares in Ceylon Tobacco Co rose 4.4%, while Sampath Bank PLC gained 2.4%.

“There is an election pending and local investors are waiting for some direction,” said Acuity Stockbrokers CEO Prashan Fernando.

Turnover was Rs. 453.2 million ($ 2.95 million), with foreign buying accounting for around 66% of it. Last year’s daily average was Rs. 915.3 million.

Foreign investors bought a net Rs. 29.4 million worth of shares yesterday, extending the year-to-date net foreign inflow to Rs. 3.1 billion worth equities.

Foreign investors bought equities worth Rs. 18.5 billion in 2017, and Rs. 633.5 million in 2016.

President Maithripala Sirisena said over the weekend that he would handle the economy from this year, taking over from the government’s main coalition partner, led by Prime Minister Ranil Wickremesinghe.

The comments have sparked uncertainty over the future of the coalition government, analysts said.