Shares slip from near 3-wk high on profit taking

REUTERS: Sri Lankan shares ended slightly weaker yesterday, ending a foursession run of gains, to slip from a near three-week high as investors booked profits, brokers said.

The Colombo stock index ended 0.28 percent or 17.72 points down at 6,350.40, slipping from its highest close since Nov. 15 hit on Monday. The bourse gained 1.17 percent last week, recording its first weekly gain in four weeks.

Despite recent gains, investors are concerned that proposed increases in various taxes and fees would reduce disposable income and challenge consumption-led growth.

“The market is going to be volatile for some time,” said Atchuthan Srirangan, a senior research analyst with First Capital Equities (Pvt) Ltd.

The government aims to boost its 2017 tax revenue by 27 percent to Rs.1.82 trillion year-on-year to meet a commitment given to the International Monetary Fund in return for a $1.5 billion loan in May.

Brokers said investors were concerned about the sustainability of rates after the Central Bank yesterday kept key rates unchanged.

Foreign investors bought a net Rs.36.9 million ($248,000) worth of shares yesterday. They have been net sellers of Rs.1.79 billion worth of shares this year.

Turnover was Rs.492.97 million, compared with this year’s daily average of Rs.698.4 million.

Shares of Commercial Leasing and Finance Plc fell 8.33 percent while Dialog Axiata Plc fell 0.95 percent.