Sri Lanka stocks fall to 3-week low; blue-chips tumble
COLOMBO May 27 (Reuters) - Sri Lanka stocks fell to a three-week low on Tuesday led by select blue-chips like Sri Lanka Telecom PLC and conglomerate John Keells Holdings PLC, while trading in shares of some financial firms boosted turnover.
The main stock index ended 0.41 percent, or 25.58 points, lower at 6,267.44, its lowest close since May 7.
The day's turnover stood at 1.38 billion rupees ($10.58 million), more than this year's daily average of 1.02 billion, helped by Multi Finance PLC, Entrust Securities PLC , and Asia Asset Finance Ltd.
The bourse saw a net foreign inflow of 35.6 million rupees on Tuesday, extending the year-to-date net foreign inflow to 1.87 billion rupees.
Stockbrokers expect the market to gain in the near future due to lower interest rates after the central bank kept key rates at multi-year lows on Tuesday for the fourth straight month, as expected.
Shares of Sri Lanka Telecom PLC fell 5.74 percent to 46.00 rupees, while John Keells Holdings PLC fell 0.38 percent to 233.10 rupees. Both stocks dragged the overall index.
After the market closed, Keells said its March-quarter net profit fell 9 percent to 4.68 billion rupees.
Multi Finance PLC ended 0.6 percent up at 16.70 rupees, while Entrust Securities PLC rose 1.46 percent to 20.80 rupees. Asia Asset Finance PLC ended flat at 1.80 rupees a share.
The market has been on a rising trend since mid-March as many investors were compelled to return to the stock market because low interest rates have made fixed-income assets less attractive, stockbrokers said.
However, analysts have raised concerns over sluggish economic growth due to lower credit growth and consumer spending.
Despite a multi-year low interest rate regime, data showed private sector credit grew 4.3 percent in March from a year earlier, the slowest expansion since May 2010.
The latest trade data, released on Monday, showed imports have gained 8.2 percent in March, while exports hit a record high of $1.07 billion helping to narrow the March trade deficit by 15.5 percent compared to a year ago.
Central bank Governor Ajith Nivard Cabraal on May 19 said Sri Lanka's private sector credit growth would pick up to around 15 percent by the end of this year and continue to improve through 2016. ($1 = 130.4000 Sri Lanka Rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil Nair)