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Saturday, August 6, 2011

Stocks at one-week low in thin trade; rupee weaker

■Bourse falls for fourth session

■Corporate earnings so far fail to impress

■Rupee weaker as CB raises trading band

Reuters: Sri Lanka’s bourse ended weaker in thin volume on Friday, in a fourth straight fall as the global market downturn began to infect the usually insulated bourse, while the rupee weakened after the Central Bank raised its trading band, traders said.

On Friday, world stocks sank for an eighth straight session, wiping $ 2.5 trillion off company values on the week, as concern ballooned over the slowing global economy and the spread of debt anguish into Italy and Spain. Sri Lanka’s main share index fell 1.18 per cent in early trade but closed 0.86 per cent or 58.49 points weaker at 6,751.29, its lowest since 29 July.

“Sentiments of global markets are reflecting through our market also,” said a stockbroker on condition of anonymity. “The (earnings) results which came on so far are also not really helping the market as they were not too exciting.”

The day’s turnover was Rs. 1.17 billion ($10.7 million), well below last year’s average of 2.4 billion and this year’s 2.65 billion. Friday’s total volume was 61.5 million, lowest since 28 July, against the five-day average of 85.1 million. The 30-day and 90-day average trading volumes were 83.5 million and 108.4 million, respectively. Last year’s daily average was 67.9 million.

Foreign investors were net sellers of Rs. 66 million worth of shares on Friday, extending the week’s outflow to Rs. 546 million and 1.13 billion in the last nine sessions. They have sold Rs. 8.79 billion in 2011 after a record outflow of 26.4 billion in 2010.

The bourse is up 1.74 per cent so far this year, after being Asia’s best performer in 2009 and 2010, gaining 124 per cent and 96 per cent respectively due to optimism over the economy after the end of a 25-year war in May 2009.

The rupee ended weaker at 109.70/75 a dollar from Thursday’s close of 109.66/68 as the central bank raised the trading band by 10 cents to 109.20/80, to match the dollar’s strengthening against other major currencies, dealers said.

source - www.ft.lk