Reuters – Sri Lankan shares rose on Wednesday, recovering from a more than three-week closing low hit in the previous session and snapping three straight sessions of falls, though floods and landslides that killed over 200 people weighed on sentiment.
The extent of the damage is yet to be assessed, with the country’s main agricultural exports – tea and rubber – hit by the worst torrential rains in 14 years.
Analysts said it is too early to evaluate the real impact of the floods and landslides, though short-term disruptions in rubber tapping and plucking of tea leaves and buds could lead to a decline in output.
Inflation could rise in the short term, especially due to crop damages and distribution difficulties with regard to fresh food produce and staple food items, they said.
“Market is up mainly on local buying. Investors are still looking for bargains. They are waiting to see weather prices would come down further,” said Dimantha Mathew, head of research, First Capital Holdings PLC.
The Colombo stock index ended 0.29 percent stronger at 6,674.32, posting a monthly gain of about 1 percent. It posted its lowest close since May 5 on Tuesday.
Turnover was 597.8 million rupees ($3.91 million) on Wednesday, less than this year’s daily average of 901.2 million rupees.
Foreign investors, who have been net buyers of 19.42 billion rupees worth of equities so far this year, sold shares worth 43.1 million rupees on a net basis.
Dialog Axiata Plc jumped 3.42 percent, while conglomerate John Keells Holdings Plc rose 0.60 percent.
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