Bourse steady at 11-week high

Reuters: Shares ended little-changed on Monday, hovering around their 11-week high hit in the previous session, led by illiquid large-cap stocks such as Carson Cumberbatch Plc and Bukit Darah Plc, brokers said.

The main stock index fell 0.05%, or 3.65 points, to close at 7,255.02, slipping from its highest close since 27 February touched on Friday.

“The market is down on large-caps, but with good turnover due to local investor confidence backed by strong corporate earnings,” said Dimantha Mathew, research manager at First Capital Equities Ltd.

Monday’s turnover was Rs. 1.1 billion ($ 8.3 million), close to this year’s daily average of around Rs. 1.11 billion.

Foreign investors were net sellers of shares worth Rs. 28.5 million on Monday, but have net bought Rs. 5.74 billion in equities so far this year.

Political uncertainty due to Prime Minister Ranil Wickremesinghe-led UNP not having a parliament majority has been a drag on the market, though the trend reversed after the central bank cut key monetary policy rates to record lows on 15 April.

The index has gained more than 5% since the rate cut.

Investors had been waiting for direction on the political front, analysts said, with the prime minister saying he would invite the main opposition to join government when he wins the parliamentary polls, which is yet to be scheduled.

Analysts, however, still expect the index to move sideways until the situation becomes clearer.

President Maithripala Sirisena has promised to dissolve the Parliament after passing some key reforms next week.

Carson Cumberbatch shares fell 2.38%, while Bukit Darah fell 2.03%.