Wednesday, 8 January 2014 00:00
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Reuters: Stocks gained to a near five-month high led by large caps and banks as active local institutional investors and foreigners bought in risky assets, and analysts said the Central Bank’s rate cut had been helping the positive sentiment.
The main stock index rose 0.54%, or 32.08 points, to 5,977.07, its highest close since 22 August.
“Institutional appetite ruled the day’s trading session with a healthy turnover level,” TKS Securities said in a note. Foreign investors bought Rs. 117.8 million ($ 901,000) worth of shares on Tuesday after buying a net Rs. 22.88 billion worth of stocks last year, compared with a record Rs. 38.68 billion net foreign inflow in 2011.
Analysts said the Bourse was sustaining its upward trend and the Central Bank’s rate cut had helped boost the sentiment.
The Central Bank slashed the standing lending facility rate or reverse repurchase rate by 50 basis points to a multi-year low of 8.00% on Thursday, in a move to reduce commercial banks’ interest rate spreads.
The day’s turnover was Rs. 716.2 million, less than last year’s daily average of about Rs. 828.4 million.
Shares in Ceylon Tobacco Company PLC gained 1% to Rs. 1,198.20, while Commercial Bank of Ceylon PLC rose 1.65% Rs. 122.90.
The index gained 4.8% in 2013 after losses in the previous two years, giving a return of 2.18% in dollar terms. Many investors locked their funds in risk-free debentures instead of risky assets due to a sluggish Bourse amid falling interest rates.
