Bourse rebounds to 7-week high on hope for politics, earnings

Reuters: Sri Lankan stocks hit a more than seven week high on Wednesday in high turnover led by blue chips as expectations of political stability after 17 August parliamentary polls lifted sentiment, brokers said.

Brokers said investors were also awaiting cues from June-quarter corporate earnings.

The main stock index ended 0.76%, or 54.04 points up at 7,199.63, its highest since 1 June.

Turnover was worth Rs. 1.62 billion ($ 2.50 million), the highest since 17 July and well over this year’s daily average of Rs. 1.05 billion.

Foreign investors were net sellers of Rs. 442.3 million on Wednesday extending year-to-date net foreign selling to Rs. 1.41 billion worth of shares.

“There was huge buying interest today specially the stocks we’re looking at for strong earnings,” said Dimantha Mathew, a research manager at First Capital Equities Ltd.

“Buying interest emerged predominantly on earning expectations.”

Conglomerate John Keells Holdings Plc rose 2.05% while Distillers Sri Lanka Plc rose 3.51%.

Analysts expect next month’s election can help strengthen President Maithripala Sirisena’s political position.