November 19, 2019 / 12:00 PM / 22 days ago

Sri Lankan shares hit over 1-year high, rupee up as Rajapaksa assumes office

COLOMBO, Nov 19 (Reuters) - Sri Lankan shares hit their highest level in more than a year on Tuesday, while the rupee rose to a three-month peak, as former wartime defence chief Gotabaya Rajapaksa assumed his presidential duties.

** Rajapaksa assumed office as the seventh president of the island nation on Tuesday after he won elections over the weekend.

** Rajapaksa made national security his top priority after being sworn in on Monday. Majority of Sinhala Buddhists voted for him after he campaigned on promises to make the nation safer in the aftermath of the Easter bombings earlier this year.

** The election outcome was positive for Sri Lanka and reduced political uncertainty, which should boost economic growth, Standard Chartered Bank said in a note. But the political establishment faced twin economic challenges of boosting growth and improving debt sustainability, it added.

** The benchmark stock index, which rose 0.75% in the early trade, ended 0.22% firmer at 6,142.76, its highest close since Aug. 9, 2018. The bourse rose 1.53% last week, and it is up 1.49% for the year. ** “There were some sort of profit taking after a surge on Monday. But still we see foreigners are on the selling side in a lower volume. The index might move sideways until investors see how the new president is going to convert his manifesto into action,” said Atchuthan Srirangan, a senior research analyst at First Capital Holdings. ** The rupee ended 0.1% firmer at 179.25/50 per dollar, its highest since Aug. 21. It closed at 179.40/80 on Monday and is up 1.87% so far this year.

** Foreign investors were net sellers of riskier assets for the ninth straight session on Tuesday.

** They sold a net 255.8 million rupees ($1.43 million) worth of shares on Tuesday, extending the net foreign outflow from the equities market to 8.3 billion rupees for the year, according to index data.

** Equity market turnover was 1.4 billion rupees well above this year’s daily average of about 699.6 million rupees. Last year’s daily average was 834 million rupees.

** Meanwhile, foreign investors bought government securities on a net basis for the fourth time in six weeks, buying a net 2.2 billion rupees worth of government securities in the week ended Nov. 13.

** Total foreign outflows from government securities through Nov. 13 stood at 48 billion rupees, central bank data said. ** For a report on global markets, click ** For a report on major currencies, click ($1 = 179.2500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Rashmi Aich)

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