Bourse up; rupee weak

Reuters: The stock market closed slightly higher on Tuesday on select large cap share buying, but investor concerns about a suspected insider deal and economic woes resulted in thin trade on low volumes.

The main share index on Tuesday edged up 0.19 per cent, or 9.55 points, to 5,125.86, the second straight rise.

The Bourse has fallen 6.34 per cent over the last nine sessions through Friday as investors sold their stakes over worries about a defaulted share deal on The Finance Company, which is now under a regulatory investigation.

Despite a 72 per cent drop in March quarter earnings, the country’s top fixed line telephone operator Sri Lanka Telecom PLC gained 1.84 per cent to Rs. 38.80 a share. Analysts attributed the gain to better than expected quarterly results for the company.

The biggest lender, Commercial Bank of Ceylon PLC, which posted a 38 per cent growth in net profit, closed flat at Rs. 105 a share.

The daily turnover was Rs. 402.1 million ($ 3.12 million), well below this year’s daily average of Rs. 1.1 billion.

The index was still in the over sold region on Tuesday with the 14-day Relative Strength Index at 23.348, below the lower neutral range of 30, Reuters data showed. It is one of the worst performers among Asian markets with a 15.6 per cent loss so far this year.

The rupee ended weaker at 128.90/129.00 against the dollar from Monday’s close of 128.50/60, on importer dollar demand.

Dealers expect the rupee will depreciate further as the Central Bank keeps policy rates unchanged on Friday amid heavy depreciation and credit growth pressure.