Reuters: Shares closed at their highest level in over six weeks on Thursday on heavy volume, led by select stocks as hopes of political stability after the 17 August Parliamentary elections helped boost sentiment.

The main stock index ended up 0.82%, or 57.95 points, at 7,124.14, its highest close since 3 June.

“Now there is a perception that the ruling party has an edge in the election and there will be policy continuity,” a stockbroker said on condition of anonymity.

“There could be volatility in the market until the election, but we see more interest in the market now compared to two weeks back. Election date, nominations, and the President’s stance on the election have addressed a number of uncertainties from the market,” the broker said.

On Tuesday, President Maithripala Sirisena criticised a comeback bid by Mahinda Rajapaksa, whom he beat in elections last January, and his own allies for backing him to become prime minister.

Analysts see Sirisena’s statement as a step towards strengthening his grip and likely to help the ruling coalition win at the polls.

The ruling United National Party (UNP) has formed a coalition with some other parties to contest the election. Political analysts say the alliance could increase the ruling party’s chances of winning.

The day’s turnover was Rs. 1.57 billion ($11.73 million), its highest since 3 July and more than this year’s daily average of Rs. 1.05 billion.

Shares in leading fixed line telephone operator Sri Lanka Telecom Plc rose 3.73%, while Lanka ORIX Leasing Co Plc rose 2.50%, pushing up the overall index.

Biggest listed lender Commercial Bank of Ceylon Plc rose 1.92%.

Rupee ends steady on State bank dollar sales

Reuters: The rupee ended steady on Thursday as a State-run bank kept the selling rate of the greenback at 133.80 amid dollar demand from importers and inward remittances ahead of the Muslim festival of Eid, dealers said.

The spot currency closed unchanged for a third straight session on Thursday, after it fell for the first time in seven sessions on Monday following the State-owned bank’s decision to raise the dollar-selling rate by 0.15%, to 133.80 from 133.60.

“There was importer demand despite the inward remittances for Ramzan (the Muslim holy fasting month) festival. But it ended steady as the State bank sold dollars,” a currency dealer said.

The rupee has been under pressure due to more than Rs. 80 billion ($598 million) worth Government securities maturing this week, dealer said.

The Central Bank has however kept the currency from falling further through sale of Treasury bonds, development bonds and T-bills, dealers said.

Central Bank officials were unavailable for comment.