Bourse gains to 8-week high on foreign buying

Reuters: Shares rose for a fifth straight session on Wednesday and closed at their highest in nearly eight weeks as foreign investors bought shares in top lender Commercial Bank of Ceylon Plc.

Foreign investors bought a net Rs. 1.9 billion ($ 12.4 million) worth of shares, mainly Commercial bank, marking the biggest single-session net foreign buying since 19 April and extending the year-to-date net foreign inflow to Rs. 19.9 billion in equities.

The Colombo stock index ended 0.2% higher at 6,507.09, its highest close since 10 August.

Heavy foreign buying boosted the day’s turnover to Rs. 2.4 billion, the highest since 15 September and more than double this year’s daily average of Rs. 923.4 million.

Commercial Bank, which surged 4%, accounted for about 79% of the day’s turnover.

“There was a significant interest in banking and finance shares as the segment is heavily undervalued,” said Dimantha Mathew, head of research at First Capital Holdings.

Shares of Lion Brewery Plc gained 3.9% while Lanka ORIX Leasing Company Plc ended 4.1% higher.

Sri Lanka’s markets will be closed on Thursday for a Buddhist holiday.