Sri Lanka stocks dragged lower by Dialog Telekom, war fears

Sri Dharanee Performance Arts Theatre

April 28, 2008 (LBO) – Sri Lanka stocks closed 0.51 percent lower, dragged down by a fall in the price of index-heavy Dialog Telekom and investor jitters over heavy army casualties in battle with Tamil Tigers, brokers said Monday. The All Share Price Index of the Colombo Stock Exchange closed 13.56 points (0.51 percent) lower at 2,638.08 points and the more liquid Milanka Index shed 36.72 points (1.12 percent) to close at 3,246.53 points.

Total turnover for the day was 219.7 million rupees.

“Dialog Telekom shed 50 cents which was the main factor for the market to drop, along with a few other stocks that also came down,” Reshan Kurukulasuriya, vice president, DFCC Stockbrokers said.

The mobile telecom operator closed at 15.75 with 421,700 shares traded.

Another heavyweight stock, conglomerate John Keells Holdings, also closed 25 cents lower at 117.75 rupees.

Investors were also worried about the progress of the war after last week’s battle with Tamil Tigers in northern Jaffna in which the army suffered heavy casualties.

“The war situation is monitored by people and has kept investors wary,” Kurukulasuriya says.

Kelani Tyres dropped by two rupees to close at 33.00 with the company saying there was no justification for last week’s unusual jump in its price as annual pre-tax profit had increased only marginally, despite sharply higher fourth quarter profits.

Kelani Tyres share price had shot up 28 percent or 7.75 to 35 rupees on Friday on speculative trading.

The annual increase in pre-tax profit was only 13.6 million rupees, the company said in a statement in response to a query by the Colombo Stock Exchange about last week’s share price increase.

There was continued investor interest in Ceylon Glass Company on speculation of sale of land owned by the company.

The share closed ten cents lower at 2.50 rupees with over 6.9 million shares changing hands. .