Shares at 18-month high on foreign buying

Reuters: Stocks rose to an 18-month high on Friday led by blue-chips as foreign buying continued, brokers said.

Analysts said concerns over a proposed tax bill weighed on overall investor sentiment.

The Colombo stock index ended up 0.66 percent at 6,747.07, its highest close since 7 January. The Bourse rose 0.47% during the week.

Foreign investors net bought Rs. 432.9 million ($ 2.82 million) worth of shares on Friday, extending their year-to-date net inflow to Rs. 22.2 billion worth of equities.

“Market is up with the continued foreign buying in big-cap shares,” said Dimantha Mathew, head of research, First Capital Holdings Plc.

Brokers said local investors have been waiting for some clarity on the proposed Inland Revenue legislation, which some companies expect will result in higher cost of production.

The IMF, which has long urged Sri Lanka to boost tax revenue through modernisation and simplification of its fiscal system, has urged the Government to submit to Parliament a new Inland Revenue Act.

Turnover was Rs. 1.2 billion, well below this year’s daily average of Rs. 928.8 million.

Shares of Ceylon Tobacco Company Plc rose 3.07%, while Dialog Axiata Plc ended 3.45% higher and Hemas Holdings Plc rose 2.82%.