Stock market ends at 2 week high; banks lead

Saturday, 3 December 2016 01:01 - - {{hitsCtrl.values.hits}}

Reuters - Shares rose for a second straight session on Friday to close at a two-week high as investors sought bargains in large-cap shares after the benchmark index hit a near-eight-month low earlier in the week.

The Colombo stock index gained 0.26% to 6,325.57, its highest close since 18 November. The bourse gained 1.17% for the week, recording its first weekly gain in four.

Turnover stood at Rs. 947.9 million ($6.40 million), more than this year’s daily average of Rs. 697.9 million.

“Buying interest continues as prices are attractive after they fell steeply,” said Richard Pieris Securities Ltd Chief Operating Officer Reshan Kurukulasuriya.

Foreign investors sold a net Rs. 250.3 million worth of shares on Friday, extending the year-to-date fund outflow to Rs. 1.84 billion.

The index had hit a near-eight-month low on Tuesday on concerns that the proposed hike in various taxes and fees would reduce disposable income and challenge consumption-led growth.

The Government aims to boost its 2017 tax revenue by 27% to Rs. 1.82 trillion year-on-year and meet a commitment given to the International Monetary Fund (IMF) in return for a $1.5 billion loan in May.

The market shrugged off the Central Bank’s monetary policy decision on Tuesday to keep rates unchanged. Brokers said investors are concerned about sustainability of rates.

Shares of Ceylon Tobacco Company PLC rose 1.60% while conglomerate John Keells Holdings PLC rose 0.67% and biggest listed lender Commercial Bank of Ceylon PLC rose 0.14%.