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Friday, January 27, 2012

Sri Lanka stocks extend rally on banks, hotels

* Bourse poses highest daily pct gain since Nov. 28

* Foreign investor net sellers

* Rupee flat on light trade; cbank pumps $6 mln to defend

COLOMBO, Jan 27 (Reuters) - Sri Lanka's share market extended its rally with a more than 2 percent gain on Friday as investors snapped up risky assets after market heavyweight and bellwether John Keells Holdings CM> posted strong earnings.

The main share index rose 2.38 percent or 133.04 points to 5,725.44, highest since Jan. 23. It has risen 3.04 percent in last two sessions.

Foreign investors booked profits while local institutional investors bought blue chips like Commercial Bank of Ceylon , which rose 4.00 percent to 104 rupees on foreign selling of 2.2 million shares.

The island nation's bourse returned to neutral territory with the Relative Strength Index at 41.210 from Thursday's oversold region of 27.965, in between the lower neutral range of 30 and upper neutral range of 70, Reuters data showed.

But it is still the worst performer among Asian markets with a 5.75 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009 and 2010.

Net foreign sales on Friday were 157.3 million rupees, but offshore investors are net buyers of 751.2 million so far this year, after net outflows of 19.1 billion last year and a record 26.4 billion in 2010.

Conglomerate Aitken Spence PLC rose 3.2 percent to 113 rupees, a day after it said that it would realise a capital gain of 630 million rupees on the sale of its 30 percent stake in Colombo harbour container terminal joint venture.

Keells gained 2.75 percent to 167.90 rupees, a day after it posted a 56 percent gain in its December quarter earnings.

The day's turnover was 1.61 billion Sri Lanka rupees ($14.13 million), less than last year's average of 2.3 billion. Volume was 59.1 million shares. Last year's daily average was a record 102.7 million.

The rupee closed flat at 113.89/90 to the dollar for a 45th straight session since a Nov. 21 devaluation with the central bank selling around $6 million to defend it, dealers said.

The bank has spent more than $1.07 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay. ($1 = 113.9050 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Bryson Hull)

source - www.reuters.com

Snapshot for Sri Lanka Colombo Stock Exchange All Share Index (CSEALL) - By Bloomberg