Sri Lanka shares resume slide, Ceylinco Insurance boosts trading volumes

Dec 01, 2008 (LBO) – Sri Lankan shares resumed their downward march Monday after two days of marginal gains last week, with a large transaction in Ceylinco Insurance propping up trading volumes, brokers said. Corporate earnings in the last quarter are down while the crash in commodity prices and high inflation and interest rates are seen eroding company profitability further.

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The All Share Price Index fell 0.21 percent (3.44 points) to end at 1,636.50 while the more liquid Milanka lost 0.71 percent (13.04 points) to end at 1,829.49. Turnover was 140 million rupees.

Ceylinco Insurance ended down 2.44 percent (five rupees) at 200 rupees with 550,000 shares changing hands even lower, at 175 rupees a share, adding 97 million rupees to the day’s turnover.

Dialog Telekom ended flat at 6.25 rupees, Sri Lanka Telecom fell 25 cents to 33.50 rupees and John Keells Holdings lost 1.50 to end at 62 rupees, all on low trading volumes.

Brokers said investors were staying out of the market owing to uncertainty about corporate earnings and a slowing economy.

Concerns over corporate and economic growth were outweighing positive news about gains on the battlefield by army units advancing deep into Tamil Tiger territory.