Bourse rises to near 3-1/2 year high on blue chips, foreign funds
Saturday, 8 November 2014 00:27
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Reuters: Stocks rose Friday to hit a near three-and-half-year high, led by blue chips such as market heavyweight John Keells Holdings Plc and on buying by foreign investors. Low interest rates and better earnings expectations boosted sentiment.
Sri Lanka’s main stock index closed up 0.78%, or 57.69 points, at 7,416.15, its highest closing level since 31 May, 2011.
“We expect strong buying interest to continue further on selected counters, driven by projected healthy quarterly earnings,” Fist Capital Equities Ltd. said in a note to investors.
“We advise investors focus their attention on financials that are being released when picking stocks as there are limited number of counters trading at attractive valuations, mainly in manufacturing, banking and energy sectors.”
Shares in Ceylon Tobacco Company Plc, which led the overall gain, rose 1.75% to Rs. 1,150.
Top conglomerate John Keells Holdings Plc, which reported on Tuesday a 29% year-on-year rise in September quarter net profit, rose 1.18% to Rs. 258.
Shares in top mobile phone operator Dialog Axiata Plc, which reported on Wednesday a 15.6% jump in its third quarter net profit, rose 2.46% to Rs. 12.50.
Foreign investors bought a net Rs. 739.6 million ($ 5.65 million) worth of shares, extending the net foreign inflow so far this year to Rs. 15.57 billion, exchange data showed.
Friday’s turnover was Rs. 2.53 billion, well above this year’s daily average of Rs. 1.39 billion.
Analysts expect trading to be choppy in the near-term due to the revised presidential poll schedule in January and a possible bottoming out of interest rates.
The country’s Central Bank has kept key policy rates steady for a ninth straight month, saying private sector credit growth was picking up and long-term lending rates were adjusting downwards.
