Thursday, 16 July 2015 14:54
COLOMBO: Sri Lankan shares hit a more than one-month high on Thursday, led by financials, as hopes of political stability after the Aug. 17 parliamentary polls helped boost sentiment.
The main stock index was up 0.72 percent, or 50.98 points, at 7,117.17 at 0830 GMT, after hitting its highest since June 8.
“Now there is a perception that the ruling party has an edge in the election and there would be policy continuity,” a stockbroker said on condition of anonymity.
“There could be volatility in the market until the election, but we see more interest in the market now compared to two weeks back. Election date, nominations, and president’s stance on the election have addressed a number of uncertainties market had.”
On Tuesday, President Maithripala Sirisena criticised a comeback bid by Mahinda Rajapaksa, whom he beat in elections last January, and his own allies for backing him to become prime minister.
Analysts see Sirisena’s statement as a step towards strengthening his grip and likely to help the ruling coalition win at the polls.
The ruling United National Party (UNP) has formed a coalition with some other parties to contest the election. Political analysts say the alliance could increase the ruling party’s chances of winning.
The day’s turnover stood at 1.45 billion rupees ($ 10.84 million), higher than this year’s daily average of 1.05 billion rupees.
In the foreign exchange market, the Sri Lankan rupee was steady in dull trade as a state-owned bank maintained its dollar selling rate at 133.80 amid demand for the greenback from importers despite inward remittances on account of the Muslim festival of Eid, dealers said.
The rupee fell for the first time in seven sessions on Monday after the state-run bank raised the dollar-selling rate by 0.15 percent to 133.80 from 133.60.
“Exporters are reluctant to sell (the dollars); there are inward remittances for Ramzan (the Muslim holy fasting month) festival. But the import demand is more,” a currency dealer said.
