Stocks edge higher as financials gain

Reuters: Shares ended marginally firmer, led by financials, though gains were muted as investors looked for fresh cues from political and economic fronts, brokers said.

The Colombo stock index ended 0.08% higher at 6,523.88, recovering from its lowest since 24 April hit in the previous session. The index lost 0.15% last week.

“There is no sentiment booster for the market. The turnover was very low and investors are keen to see some positive factors in political and economical fronts,” said Prashan Fernando, CEO at Acuity Stockbrokers.

Top lender Commercial Bank of Ceylon closed 0.3% firmer while Sampath Bank ended 0.4% higher.

Analysts said depreciation of the rupee also weighed on the sentiment as it is likely to dent the profits of some listed firms that rely heavily on imports.

The Sri Lankan rupee hit a fresh low on Wednesday on importer demand for the US currency, dealers said, but recovered after the central bank intervened in the market.

Fitch Ratings said on Thursday that recent political developments in Sri Lanka have created some uncertainty over reform momentum and fiscal consolidation, and prolonged upheaval could undermine investor confidence ahead of large external debt maturities in 2019-22.

Turnover stood at Rs. 463.2 million ($ 2.94 million), less than half of this year’s daily average of Rs. 1.05 billion.

Foreign investors bought a net Rs. 46.3 million worth of equities on Thursday, but the market has seen a net foreign outflow to Rs. 622.7 million worth of equities so far this year.