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Lankan
shares snap 3-day rise, results awaited
COLOMBO, May 6 (Reuters) - Sri Lankan shares snapped
a three-day rise and eased 0.1 percent on Tuesday as investors
awaited quarterly earnings that could show the bruises from
a tough economic environment. Traders said companies had to
battle high inflation, stiff interest rates and a worsening
security situation in the March quarter.
“Investors are adopting a wait-and-see policy ahead of
the corporate results,” said Geeth Balasuriya, assistant
manager research at HNB stockbrokers. “It has been a
distress quarter.” The Colombo All-Share index shed 2.73
points to 2,645.50. Turnover was 269.66 million rupees ($2.5
million), half of last year’s daily average of 400 million.
The rupee closed weaker at 107.87/90 per dollar from Monday’s
107.80/83. Cargills (Ceylon) fell 7.36 percent to 44 rupees
calculated on a weighted average, while shares in Hatton National
Bank lost 1.49 percent to 115.25 rupees. Traders said Distilleries
Company of Sri Lanka gained 0.25 percent to 108.25 rupees
on a block deal. Sri Lanka’s biggest listed bank, Commercial
Bank, posted a 11.4 percent rise in group net profit for the
first quarter but analysts said the results were below expectations.
Shares in Commercial Bank, which has a market value of 33.1
billion rupees, dropped 0.58 percent to 142.17 rupees. The
main index fell almost 7 percent in early January when the
government scrapped a six-year truce with Tamil Tiger rebels,
but then recovered and is up 4.11 percent in 2008. In late
April, hundreds of troops and rebels were killed as fighting
intensified in the far north of the island where the rebels
are demanding an independent state. Sri Lanka said last week
annual inflation measured on the 12-month moving average of
a new consumer price index ticked up to 18.7 percent in April
from 17.7 percent in March.
Under an old index, which will be phased out in September,
inflation accelerated to 20 percent in April from 18.8 percent
in March. The Central Bank said on Tuesday it had opened its
treasury bill market to foreign investors to help broaden
the government securities market. The move will allow foreign
investors to buy more than $340 million of rupee bills this
year, according to one Central Bank official. The interbank
lending rate rose to 16.289 percent from Monday’s 15.499
percent.
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