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Wednesday, May 11, 2011

Sri Lanka shares at 1-wk low on retail selling; rupee up

* Bukit Darah, Sri Lanka Telecom drive down index
* Market sees 101.1 million rupee foreign inflow
* Rupee up on exporter, bank dlr selling

COLOMBO, May 11 (Reuters) - Sri Lankan shares fell on Wednesday to a one-week low on retail selling in thin trade as investors stayed sideline on concerns over a regulator directive on credit share trading and to buy shares offered in IPO, while the rupee edged up.

Sri Lanka's main share index fell 0.8 percent or 58.99 points to 7,280.66, its lowest close since May 4.

Analysts said many investors sold to raise cash for Thursday's initial public offering by conglomerate ExpoLanka, the biggest so far in 2011. The approach of the Securities and Exchange Commission's June 30 deadline to stop margin trading also weighed on sentiment. [ID:nL3E7G41M6] [ID:nSGE6AS0BD]

Illiquid oil palm firm Bukit Darah fell 3.3 percent, while the island nation's top fixed line operator Sri Lanka Telecom closed 3.4 percent weaker.

Foreign investors were net buyers with an inflow of 101.1 million rupees' worth of shares on Wednesday. They have sold a net 5.69 billion in 2011, and a record 26.4 billion in 2010.

Turnover was 1.72 billion Sri Lanka rupees ($15.68 million), well below last year's average of 2.4 billion rupees and this year's daily average of 2.84 billion rupees.

Traded volume was 50.2 million, against a five-day average of 68.8 million. The 30-day and 90-day average trading volumes were 57.6 million and 64.7 million, respectively. Last year's daily average volume was 67.9 million.

The bourse is still Asia's best performer in 2011 with an 10.6 percent gain, after bringing in the region's top gain, 96 percent, last year.

The rupee ended firmer at 109.70/75 a dollar from Tuesday's close of 109.77/78 as exporters and banks sold dollars, dealers said.

FACTORS TO WATCH:

- Impact of global commodity price volatility on the Sri Lankan bourse

- If Sri Lanka can achieve an 8.5 pct growth target amid rising global oil prices and inflation

- March quarter corporate results

source - www.reuters.com