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Sri Lanka stocks gain for 3rd session; investors advised to choose quality shares
January 9, 2014 / 11:51 AM / 4 years ago

Sri Lanka stocks gain for 3rd session; investors advised to choose quality shares

COLOMBO, Jan 9 (Reuters) - Sri Lankan stocks rose for a
third straight session to a near five-month high on Thursday
with turnover boosted by foreign buying in risky assets, while
analysts asked investors to focus on quality shares for
double-digit returns. 
    The main stock index gained 0.25 percent, or 14.87
points, to end at 6,069.34, its highest close since Aug. 22. It
has gained more than 2 percent in the last three sessions, with
the index now in an over-bought region.  
    Analysts said the central bank's interest rate cut last week
and the recent fall in T-bill yields had boosted sentiment and
helped sustain the gain., 
    First Capital Equities advised investors in a note against
seeking speculative positions and to focus on quality companies
that would generate double-digit returns over a reasonable
investment horizon. 
    "Investors are advised to refrain from applying a herd
mentality in the current sideways market, but use the
opportunity to review their portfolios in order to ensure that
their allocations continue to reflect their risk appetite,
investment goals and horizon," it said. 
    The CSE index gained 4.8 percent in 2013 after losses in the
previous two years, giving a return of 2.18 percent in dollar
    Many investors locked their funds in risk-free debentures
instead of risky assets due to a sluggish bourse and falling
interest rates.
    The day's turnover was 1.57 billion rupees, surpassing last
year's daily average of about 828.4 million rupees. Foreign
buying accounted for 56 percent of the turnover. 
    Foreign investors bought a net 109 million rupees ($833,000)
worth of shares on Thursday, extending year-to-date foreign
inflows to 169.8 million rupees. 
    Offshore investors bought a net 22.88 billion rupees worth
of stocks last year, while 2011 saw a record 38.68 billion
rupees in net foreign inflows.
    Ceylon Tobacco Co PLC shares rose 1.09 percent to
1,219.50 rupees, while Nestle Lanka PLC gained 1.91
percent to 2,166.80 rupees.
($1 = 130.8500 Sri Lanka rupees)

 (Reporting by Ranga Sirilal and Shihar Aneez; Editing by
Prateek Chatterjee)

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