Rupee, stocks end weaker; ruling party’s decision awaited

(Colombo) REUTERS: Sri Lanka’s rupee closed weaker for the sixth straight session yesterday, while equities closed lower ahead of a key decision by Prime Minister Ranil Wickremesinghe’s ruling party on its candidate for the November 16 election.

The market has been waiting for Wickremesinghe-led United National Party (UNP) candidate and its policies, brokers and traders said. The opposition party had named a hard-line former defence chief as its presidential candidate.

The rupee closed 0.1 percent weaker at 181.30/70 to the dollar, compared with Friday’s close of 181.10/20. The currency fell 0.47 percent last week, but is up 0.7 percent for the year.

Analysts said foreign outflows from government securities have shown a declining trend and the market is now waiting for foreign investors to reverse the selling trend.

The Central Bank does not release foreign flow numbers on a daily basis, but weekly data in the past four weeks has shown an outflow.

Foreign investors sold government securities worth Rs.545.9 million in the week ended September 18 for a fifth straight week, data showed, extending the net foreign outflow so far this year to Rs.54.9 billion through September 11, the Central Bank data showed.

The benchmark stock index ended down 0.3 percent at 5,776.48. The bourse fell 0.54 percent last week.

So far this year, the stock index has dropped 4.72 percent.

Equity market turnover was Rs.485.6 million, less than this year’s daily average of about Rs.670 million so far. Last year’s daily average was 834 million.