COLOMBO Aug 5 Sri Lankan stocks slipped on
Tuesday from a near-three-year closing high in the previous
session led by large-cap shares such as Ceylon Tobacco Company
Plc and on technical correction in some over-valued
shares, analysts said.
The main stock index ended 0.1 percent, or 6.73
points, weaker at 6,815.42, slipping from its highest close
since September 20, 2011 hit on Monday. It rose 6.82 percent in
July and is up 15.27 percent so far this year.
"Drop in CTC led the decline in the market. CTC's
lower-than-expected results and some correction in over-valued
shares brought the market down," said a stockbroker asking not
to be named.
The bourse hit a near-three-year high on Monday on
expectation of strong corporate earnings and interest rates
falling further with continued buying by foreign investors.
Hopes of strong corporate earnings, declining interest rates
and continued buying by foreign investors have helped boost
interest in risky assets in the $21.97 billion-worth stock
Turnover was 1.57 billion rupees ($12.06 million), more than
this year's daily average of about 1.09 billion rupees.
Foreign investors were net buyers of 107.1 million rupees
worth of shares on Tuesday, extending the year-to-date net
foreign inflow to 11.04 billion rupees.
The index has been in the overbought region since July 3, as
local investors moved funds from fixed income to riskier assets
because of low interest rates and foreign buying.
Losses were led by large-cap share Ceylon Tobacco Company
Plc which fell 1.04 percent to 1,137.20 rupees a day
after the company reported a 11 percent fall in June quarterly
Shares in Carson Cumberbatch Plc fell 1.08 percent
to 460 rupees while top conglomerate John Keells Holdings Plc
fell 0.04 percent to 236.90 rupees.
Shares in biggest listed lender Commercial Bank of Ceylon
Plc fell 0.98 percent to 141.50 rupees.
Capital Alliance Finance Plc in a discloser to the
bourse said its controlling shareholder Capital Alliance
Holdings Limited divested 68.43 percent of its issued capital to
Cargills Bank at prices ranging from 15.40 rupees to 15.50
Lower interest rates have prompted local investors to buy
shares and move away from unattractive fixed assets, analysts
said. Yields on treasury bills edged down further by 7-10 basis
points at a weekly auction on Wednesday.
The International Monetary Fund urged Sri Lanka on Wednesday
to keep key interest rates on hold for the near term and said a
cautious approach is warranted.
($1 = 130.1800 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil