Sept 11, 2012 (LBO) – Sri Lanka’s stocks closed marginally lower Tuesday ending a 10 straight days of gains that followed the replacement of a regulator who was tough on securities fraud, brokers said. Politically connected investors and brokers blamed SEC rules and investigations of micro cap fraud including pump and dump scams for the falling market.
Abans Finance fell 1.70 rupees to close at 42.10 rupees, Arpico Finance fell 5.70 to close at 89.50, Asia Asset Finance fell 20 cents to close at 3.10, Associated Motor Finance fell 23.10 rupees to close at 391.90 rupees, Capital Alliance Finance fell 1.00 rupee to closed at 29.00.
Central Finance fell 3.30 to close at 162.50 and Commercial Credit and Finance fell 20 cents to close at 17.40 rupees but Alliance Finance rose 20.50 to close at 721.80.
Dankotuwa Porcelain closed up 6.10 rupees at 24.10, Citrus Leisure closed up 2.60 at 34.00 rupees and HVA Food closed up 1.30 at 19.00 rupee being among the top contributors by volume. The Colombo All Shared Index closed at 5,590.90 down just 1.13 points lower (0.02 percent) and the S & P SL 20 index closed at 3,034.00 up 7.50 points (0.25 percent).
Turnover was 1.9 billion rupees with a large stake in Serendib Hotels, boosting volumes.
The top contributor to the index was Selinsing an illiquid palm oil stock that rose 500 rupees to 1,599 with only a single share being traded, according to stock exchange data.
Sri Lanka Telecom, another illiquid stock large cap stock closed up 1.20 at 44.70 rupees, becoming the second largest contributor to the days index gain.
Some of the finance companies which had shot up in recent days lost ground Tuesday. Finance companies have been rising despite new car registrations plunging, interest rates rising and prospects of higher bad loans looming, analysts said.
Sri Lanka’s stocks which weakened as interest rates rose ending a credit driven rally started to go up after the stock market regulator was replaced for the second time.