Bourse ends at lowest since mid-July

Reuters: Shares ended at their lowest level in more than two months on Friday, slipping for a fourth straight session, led by diversified stocks as cautious investors awaited clues amid a weakening rupee and an upward trend in interest rates.

The main stock index ended down 0.08 at 7,107.87, its lowest close since 15 July.

“There are not many local investors. They are awaiting clear policy direction,” said Harsha Fernando CEO at the Sampath securities in Colombo. Turnover stood at Rs. 529.4 million ($ 3.8 million), less than half of this year’s daily average of Rs. 1.12 billion. The turnover has been about half of this year’s daily average since 31 August, stock exchange data showed.

Analysts said investors were waiting to see how the Government would bridge the budget deficit and where the revenue would come from, in its November budget.

A weak rupee curbed investor risk appetite and rising market interest rates also hit sentiment, with t-bill yields at their highest level in more than five months at the last auction.

The rupee ended slightly weaker on thin importer dollar demand a day after recovering in the previous session from a record low.

Foreign investors were net sellers of Rs. 46.5 million worth of shares on Friday extending the year to date net foreign outflow to Rs. 2.99 billion.

Shares in conglomerate John Keells Holdings Plc declined 0.58%, and brokers attributed the fall to new shares coming in with the expiration of warrants.

Shares in Dialog Axiata Plc fell 0.89% while C T Holdings Plc slipped 3.05%.