Reuters: Sri Lanka’s stock market rose on Wednesday, but analysts said thin trading and continuous foreign selling suggested investors were worried the aftershocks of the Middle East/North Africa crisis could dent the island’s post-war economic growth.
Analysts said the crises in Libya and elsewhere weighed on the bourse on concerns over higher oil prices, possible job cuts for Sri Lankans working in the Gulf and a likely hit on tea exports. Investors globally have been scaling down exposure, as oil prices have surged with the string of popular revolts.
The island’s main share index rose 0.45 per cent or 34.12 points to 7,548.86. It hit a record closing high of 7,811.82 on 14 February. Foreign investors were net sellers for the 10th straight session, selling a net Rs. 366.7 million on Wednesday, extending the total net foreign outflow to Rs. 6.7 billion in 2011, after selling a record net 26.4 billion in 2010.
The bourse has still been Asia’s best performer with a 13.8 per cent gain in 2011 after being in the region’s top spot with a 96 per cent return last year.
Turnover was Rs. 2.4 billion ($ 21.69 million), similar to last year’s average of Rs. 2.4 billion and this year’s daily average of Rs. 3.8 billion. Traded share volume was 55 million, against a five-day average of 57.3 million. The 30-day and 90-day average trading volumes were 140.8 million and 68.1 million respectively. Last year’s daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E) ratio of 16.4, one of the highest among emerging markets, compared with 12.8 in Asian markets and 11.8 in global emerging markets, Thomson Reuters StarMine data showed. The rupee closed flat at 110.87/110.89 a dollar, as a State bank sold dollars at 110.90, dealers said.
source - www.ft.lk
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