Stocks edge up from 2-week low in thin trade

Reuters: Shares inched slightly higher on Friday from a two-week closing low, but foreign selling amid political uncertainty weighed on trade, stock brokers said.

The Colombo stock index ended 0.08% firmer at 6,557.02, edging up from its lowest close since 14 February hit on Wednesday. Sri Lankan markets were closed for a holiday on Thursday. The index fell 0.28% this week.

Turnover stood at Rs. 449.5 million ($2.90 million) on Friday, well below this year’s daily average of Rs. 959.5 million.

Stock brokers said the absence of some fund managers who are attending an investor forum in Singapore hit the turnover.

“We expect the market to rebound next week after the investor forum,” said First Capital Equities CEO Jaliya Wijeratne.

Prime Minister Ranil Wickremesinghe, securities regulators and exchange officials are attending the investor forum to attract foreign investments into the island nation’s risky market, analysts said.

Foreign investors sold a net Rs. 139.3 million worth of shares, but they have been net buyers of Rs. 5.9 billion worth of equities so far this year.

Shares of Ceylinco Insurance Plc rose 6.9%, while conglomerate John Keells Holdings Plc firmed 1.8% and Dialog Axiata Plc DIAL.CM gained 1.5%.

Shares hit a more than three-week high last week after two key parties in the ruling coalition decided to remain in the ruling coalition, allaying fears of a Government collapse.

President Maithripala Sirisena reshuffled his Cabinet on Sunday, appointing his Prime Minister as the Law and Order Minister, after the governing coalition suffered a series of defeats in local elections earlier this month. 

However, the changes failed to boost the market as the Cabinet reshuffle was not enough to address the election defeats, analysts said.