COLOMBO, Jan 16 (Reuters) - Sri Lanka’s stock market rose more than 1 percent on Wednesday to hit a three-month high, helped by foreign buying in large caps and falling interest rates ahead of the central bank’s January monetary policy rates announcement.
The main share index closed up 1.08 percent, or 62.23 points, at 5,812.47, its highest close since Oct. 9.
“Foreign investors bought large caps,” a stockbroker said on condition of anonymity. “We see a positive outlook for the market at the moment due to falling interest rates.”
Ceylon Tobacco Company PLC slimbed 2.80 percent firmer to 899.40 rupees while Chevron Lubricants Lanka PLC closed 3.79 percent up at 227.20 rupees.
The central bank is expected to keep key policy rates steady on Thursday after last month’s surprise rate cut, a Reuters poll showed, but analysts see further easing in monetary conditions during the first half.
On Wednesday, T-bill yields eased for the seventh straight week. The 91-day yields eased 13 basis points to a 10-month low of 9.75 percent.
Foreign investors were net buyers of 112.1 million rupees ($886,200) worth of shares, extending the net inflow to 482.6 million rupees so far this year. Last year, Sri Lanka enjoyed a record 38.63 billion rupees foreign inflow.
The day’s turnover was 636.2 million rupees ($5.03 million).
The rupee closed marginally weaker at 126.55/60 to the dollar from Tuesday’s close of 126.50/60, traders said. ($1 = 126.5000 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Ron Popeski)