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Sri Lankan shares slip on profit-taking; Keells leads fall
February 3, 2014 / 12:05 PM / 4 years ago

Sri Lankan shares slip on profit-taking; Keells leads fall

COLOMBO, Feb 3 (Reuters) - Sri Lankan shares slipped to a
near-one-week low on Monday due to profit-taking led by top
conglomerate John Keells Holdings despite foreign
buying ahead of a holiday.
    Stockbrokers, however, expect the bourse to gain in the near
future due to lower interest rates.
    The main stock index fell 0.46 percent, or 28.74
points, to 6,219.34, its lowest level since Jan. 28.
    "We expect the market to rise in the near future due to the
simple reason that our interest rates are low. Keeping the funds
at normal saving will be a loss for value for their money," a
stockbroker said on condition of anonymity. 
    Stockbrokers said retail and institutional investors were
active in the market after interest rates on treasury bills
eased at a weekly auction on Wednesday to multi-year lows,
making fixed-income assets unattractive. 
    The stock and currency markets will be closed on Tuesday for
a holiday for the island nation's 66th Independence Day. Trading
will resume on Wednesday. 
    Shares in Conglomerate John Keells Holdings PLC 
fell 2.08 percent to 235 rupees. 
    Stockbrokers said investors will shrug off political risks
from renewed pressure by the U.S. to bring a fresh resolution
against Sri Lanka at a U.N. Human Rights Council meeting in
March, because the market had been expecting the worst. 
    "Based on the U.S. embassy's communique, we don't expect any
economic or trade embargoes against Sri Lanka in the forthcoming
UNHRC session," Danushka Samarasinghe, head of TKS Securities
Research, told Reuters.
    "Therefore it is unlikely that any adverse impact would
result for the market following the UN session and sometimes the
market could get stronger since much more adverse measures were
    Foreign investors were net buyers of 290.3 million rupees
($2.22 million) worth of shares on Monday, extending the
year-to-date net foreign inflow to 1.32 billion rupees. They
bought 22.88 billion rupees worth of stocks last year.
    The index, which was in an overbought region since Jan. 7,
touched the neutral region on Monday, Thomson Reuters data
showed. It has risen 5.18 percent so far this year, following a
4.8 percent gain in 2013, after having fallen in the previous
two years.
    The day's turnover was 1.1 billion rupees, more than last
year's daily average of about 828.4 million rupees.
  ($1 = 130.7500 Sri Lanka rupees)

 (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil

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