Sri Lankan stocks close 2.0-pct lower

Standing left to right – Mr. Dinesh Jebamani (Chief Manager Liability Product Management and New Age Media – Seylan Bank), Mr.Sudesh Peiris (Senior Manager – Digital Banking Channels – Seylan Bank), Ms. S.Senevirathne (Representative of the Revenue Department – Western Province), Mr. Tilan Wijeyesekera (Deputy General Manager – Retail Banking – Seylan Bank) and Mr. Malik Wickremanayaka (Deputy General Manager – Operations – Seylan Bank)

Nov 19, 2008 (LBO) – Sri Lankan stocks closed 2.0 percent lower Wednesday with a poor earnings outlook and high interest rates keeping buyers at bay, and the effects of a global downturn biting harder, dealers said.

The Colombo All Share Price Index fell 36.41 points to end at 1,717.52 while the Milanka index of liquid stocks fell 1.92 percent (37.80 points) to 1,927.44.

Turnover was 102.9 million rupees.

“Investors are still cautious to invest in the market due to concerns regarding corporate earnings outlook,” says Shivantha Mepage from HNB stockbrokers.

“Higher short term money market rates have deterred investors from entering the market”

Sri Lanka’s risk free rates are bringing yields around 20 percent.

Mohan Thangaraja from First Guardian equities say the effects of a global downturn, is also beginning to be felt harder.

Index heavyweights SLT fell 1.00 rupees to close at 35.75, Commercial Bank fell 75 cents to 84.00 rupees and Hatton National Bank by one rupee to close at 83.00 rupees.

Despite gloomy investor appetite some counters made light gains today as Vallibel Power Erathna shares closed up 30 cents at 3.30 ruipees and John Keells Holdings closed up 25 cents at 65.50 rupees.

Nestle Lanka closed up/down what contributing 24 million rupees to the day’s turnover with volume also coming form Seylan Bank, Lanka lubricants, Vallibel Power and Dialog Telekom dealers said.

Foreign buying was at 18.1 million rupees, while selling amounted to 20.1 million.