Stock market at 11-week low despite foreign inflows

COLOMBO (Reuters): Sri Lanka’s stock market fell to an 11-week low on Monday as a state pension fund bought weakened Laugfs Gas shares, while foreign investors snapped up market heavyweight and institutional favourite John Keells Holdings.

The island nation’s main share index closed 0.44 per cent or 29.79 points down at 6,669.04, its lowest close since 28 July. It has now slipped to Asia’s third-best performer with a return of 0.50 per cent on the year after being on the top for most of 2011.

The bourse witnessed a net foreign inflow of Rs. 135.1 million on Monday, most of it going to the purchase of Keells shares, which closed steady at Rs. 200.

Thus far in 2011, offshore investors have sold 17.2 billion after offloading a record 26.4 billion in 2010.

Shares of Laugfs, which accounted for 58.5 per cent of the day’s turnover and 46.2 per cent of the volume, closed 7.04 per cent weaker at 44.90 rupees. Brokers said the State-owned Employees’ Provident Fund pension fund bought a 10 per cent stake, increasing Government control of the gas sector.

Losers outperformed gainers by 138 to 56, Thomson Reuters data showed. Turnover was Rs. 3 billion ($ 27.2 million), its highest since 13 September and more than last year’s average of 2.4 billion and this year’s 2.7 billion.

Monday’s total volume was 79.8 million, against a five-day average of 80.3 million.

The 30-day and 90-day average trading volumes were 147 million and 138 million. Last year’s daily average was 67.9 million.

The rupee closed steady at 110.18/20 a dollar for an eighth straight day, as a State bank continued dollar sales at a flat rate of Rs. 110.20, in spite of importer demand, dealers said.