Sri Lanka shares mark 3-wk closing high; political woes weigh

January, 31, 2018

Reuters - Sri Lankan shares notched a near three-week closing high on Tuesday led by market heavyweight John Keells Holdings, but political uncertainty ahead of a local election next month weighed on sentiment, dealers said.

Sri Lanka will hold a long-delayed local government election on Feb. 10.

President Maithripala Sirisena in an election rally over the weekend said he was ready to form a new government with his Sri Lanka Freedom Party (SLFP), breaking away from the current coalition - a comment that exacerbated worries about the future of the coalition government.

“Nobody knows if the president is making statements for political reasons or if he actually means it. So investors are waiting for some clear direction and political stability after the polls,” said Prashan Fernando, CEO at Acuity Stockbrokers.

The Colombo stock index ended up 0.35 percent at 6,476.41, its highest close since Jan. 11. The index rose 0.19 percent last week, recording its first weekly gain in three.

Shares in conglomerate John Keells Holdings Plc closed up 1.1 percent, while Janashakthi Insurance Company Plc rose 17.7 percent. Dialog Axiata Plc ended 1.5 percent higher.

Foreign investors bought a net 18.5 million rupees worth of shares on Tuesday, extending the year-to-date net foreign inflow to 4.04 billion rupees worth of equities.

Sri Lanka’s stock, bond and foreign exchange markets are closed on Wednesday for a Buddhist religious holiday. Markets will resume trading on Thursday.