Shares gain after Gota launches presidential bid
(COLOMBO) REUTERS: Shares closed marginally higher yesterday, easing from early gains of 1.2 percent, after the main opposition party named a hard-line former defence chief as presidential candidate, seeking to capitalise on public clamour for a decisive leader.
The rupee ended slightly weaker on importer greenback demand. The benchmark stock index gained 1.26 percent as soon as trading resumed yesterday. Markets were closed for a holiday on Monday. The index ended 0.1 percent firmer at 5,949.30, its highest close since July 30. It gained 0.82 percent last week.
Gotabaya Rajapaksa, 70, served under his older brother, ex-president Mahinda Rajapaksa, and is widely seen as the frontrunner in a presidential election that must be held before Dec 9.
Gotabaya is immensely popular among Sri Lanka’s powerful Sinhala Buddhist majority, who credits him with ending the island nation’s 26-year-long civil war in 2009 and believe Colombo needs a seasoned hand after the April 21 bombings.
Market sources said early gains could not be sustained as retail investors sold shares. So far this year, the index dropped about 1.7 percent.
Turnover was Rs.2.69 billion (US$15.21 million), more than six times of this year’s daily average of about Rs.654 million so far. Last year’s daily average came in at Rs.834 million.
Shares of Lion Brewery Ceylon Plc rose 3.4 percent and large-cap Nestle Lanka Plc climbed 1.6 percent.
The rupee ended at 176.90/177.00 per dollar, compared with Friday’s close of 176.75/95.
The rupee fell 0.08 percent for the last week, but is up nearly 3.2 percent so far this year.
The Central Bank left key interest rates unchanged on July 11 as expected, after cutting them in May to support the economy as tourism and investment plummeted in the wake of deadly suicide bombings in April.
Foreign investors sold a net Rs.729 million worth of government securities in the week ended Aug. 7, extending the year-to-date net foreign outflow to Rs.28 billion, Central Bank data showed.