Sri Lanka shares weaken further

Nov 13, 2008 (LBO) – Sri Lanka’s main share market index slumped two percent Thursday with liquidity drying up as investors stayed away from trading given uncertainties over economic and corporate growth, brokers said.

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The All Share Price Index lost 37 points to end at 1,812.08 while the Milanka fell 1.87 percent (38.42 points) to 2,021.62. Turnover was 114 million rupees.

“Liquidity has dried up,” said Mohan Thangarajah of First Guardian Equities. “Investors are taking a negative view of the market.”

The indices were dragged down by falls in market heavyweights.

John Keells Holdings fell five percent or 3.50 rupees to 65 rupees with 161,600 shares traded.

Sri Lanka Telecom fell 75 cents to 37 rupees while Dialog Telekom closed unchanged at seven rupees with 244,600 shares changing hands.

Brokers said all sectors on the Colombo bourse were down and only eight of the 234 listed stocks gained in price.

They said investors were worried about the gloomy outlook for the economy, given global recession fears.

Investors were also concerned about the future earnings of companies which are grappling with sharply higher costs at a time when demand is slowing down.

Concerns about the over-valued rupee were also weighing on the market, brokers said.