Sri Lankan stocks close down 0.10-pct

Sept 27, 2010 (LBO) – Sri Lankan stocks failed to hold on to early gains which propelled them past the 7,000 point mark for the first time in early trade Monday and closed weaker, brokers said. The market lost the momentum which had sent it to record highs in recent days with investors cashing-in to cover margin trades, they said.

The All Share Price Index closed at 6,881.54, down 0.10 percent (6.95 points) while the more liquid Milanka index dipped 0.43 percent (31.48 points) to close at 7,232.17, according to stock exchange provisional figures.

Turnover was 3.7 billion rupees.

“There is a possibility the market will slowdown in the coming weeks due to new regulations on credit effective from January next year, while some investors took profits,” Thakshila Hulangamuwa, vice president at Asha Phillip Securities said.

“Due to a lack of participation we won’t see turnover levels improving from the current range of four to five billion rupees.”

Bogala Graphite, which last week said it planned to get a plant from its German parent to make lubricant, was the day’s highest gainer, closing at 55.70 rupees, up 21. 20 or 61 percent.

A five-year five billion rupee bond issued by the Urban Development Authority (UDA), a state agency, was over-subscribed and will be kept open until subscription of a further five billion rupees, a stock exchange filing said.

The UDA is issuing 50 million debentures at 100 rupees each, to be doubled if oversubscribed, to raise cash to resettle squatters occupying prime property in Colombo city owned by government and to free land for private sector commercial development.

The bonds are to be listed on the main board of the Colombo Stock Exchange.