COLOMBO, July 3 Sri Lankan stocks hit their
highest level in more than 13 months on Thursday, helped by
foreign buying in top lender Commercial Bank of Ceylon
, while talks of a U.S.-based fund acquiring a stake in
conglomerate Hemas Holdings boosted sentiment.
The main stock index ended higher 0.54 percent, or
34.76 points, at 6,467.28, its highest level since May 23, 2013.
Dealers said a U.S.-based fund bought a 6.5 percent stake in
Hemas Holdings on Wednesday.
"Foreign buying is strong and we see now others are also
coming to the market to buy big quantities," a stockbroker said
on condition of anonymity.
Analysts said foreigners have been buying risky assets
because they see values in them, while falling yield in fixed
assets is gradually prompting local investors to shift their
funds to equities.
Foreign investors were net buyers for an eighth straight
session on Thursday, buying 265.9 million rupees of stocks
during the day and extending foreign inflows this year to 9.2
Turnover was 1.51 billion rupees ($11.59 million), more than
this year's daily average of around 1 billion rupees.
Shares of Commercial Bank of Ceylon jumped 3.41 percent to
148.60 rupees, while Hemas Holdings rose 1.1 percent to 46
Brokers said investors are bullish about the market after
they witnessed large state funds actively traded shares on
Analysts said foreign buying could continue due to lower
inflation after government data showed annual inflation eased to
2.8 percent in June, its lowest since February 2012, down from
3.2 percent a month earlier.
Yields on treasury bills edged down further at a weekly
auction on Wednesday.
However, analysts said investors are concerned over the
recent ethnic violence and possible implications of a government
spokesman saying Sri Lanka bought Iranian crude via third
The market has been on a rising trend since late February
due to continued foreign buying and lower interest rates.
($1 = 130.2300 Sri Lankan Rupees)
(Reporting by Shihar Aneez; Editing by Subhranshu Sahu)