Reuters – Sri Lankan shares ended weaker on Wednesday as investors sold blue chips such as Ceylon Tobacco Co, but foreign investors’ appetite for risky assets limited the downslide.
The Colombo Stock Index ended 0.4 percent weaker at 6,502.96.
Turnover stood at 376 million rupees ($2.45 million) on Wednesday, well below last year’s daily average of 915.3 million rupees.
Foreign investors, which accounted for more than 65 percent of the day’s buying, net bought shares worth 18.2 million rupees on Wednesday, extending the net foreign inflow in this year to 2.23 billion rupees.
They had net bought 18.5 billion rupees worth equities in 2017 and 633.5 million rupees in 2016.
“Market is consolidating with some profit-taking,” said Dimantha Mathew, head of research, First Capital Holdings.
“We don’t see a big run at the moment. It won’t come down drastically but the market will consolidate at these levels before the next move.”
Analysts expect the market to settle at 6,600 levels.
Ceylon Tobacco Company Plc ended 3.3 percent down, while Hatton National Bank Plc closed 0.8 percent lower.
Treasury bill rates fell between March and December last year, mainly driven by foreign buying in treasury bonds, resulting in a decline in interest rates.
The country’s 2018 economic growth trajectory is likely to help boost market sentiment, analysts said.
Sri Lanka’s economic growth in 2018 is forecast at 5-5.5 percent, against an anticipated four-year low of less than 4 percent last year, central bank governor Indrajit Coomaraswamy said last week.
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