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Sri Lanka stocks close lower amid uncertainty

Apr 19, 2013 (LBO) - Sri Lanka's stocks closed lower Friday, recouping some losses form a mid-day sell-off, amid uncertainty over the effects of power tariff hike and weaker commodity prices, brokers said. Weaker commodity prices usually signals a strengthening of the underlying value reserve currencies such as the US dollar and Euro coming from weak loan growth or de-leveraging.

Plantations companies also weakened. Tea estates are facing higher wages and weakening global commodity prices, brokers said.

Kahawatte Plantations closed at 37 rupees down by 0.10 rupees. Kegalle Plantations closed at 116.80 down by 3.20 rupees. Kelani Valley Plantations closed at 80.20 rupees down 4.52 rupees

Tokyo Cement, which operates grinding plants closed at 24.00 rupees down 0.50 rupees Analysts say cement firms could benefit from weaker clinker prices but could be hurt by higher electricity prices.

Holcim Lanka, an unlisted firm which runs an integrated cement factory told a public hearing on a power tariff hike that the move would add 9.0 rupees to a 50 kilogram cement pack.

Nestle Lanka closed at 1770.00 rupees down by 4.60 rupees.

Copper prices have also tumbled more than 20 percent a 2012 peak, which could help companies such as Sierra Cables, though factories face higher power prices.

Sierra Cables closed at 2.50 rupees down by 0.10 rupees

Ceylon Tobacco Company and index heavy stock which gained 11.70 rupees to close at 800.00 rupees and Ceylinco Insurance which gained 49.10 rupees to close at 999.00 rupees helped offset losses on other stocks, brokers said.

Dialog Axiata closed flat at 9.20 rupees while Index heavy John Keells Holdings closed at 248.80 rupees down 0.20 rupees.

Distilleries Company of Sri Lanka close at 166.60 rupees down 3.40 rupees

Aitken Spence closed flat at 120.00 rupees

The Colombo All Share Index Index closed 9.58 points lower at 5,882.25 down 0.16 percent and the S&P SL 20 Index closed 15.03 points lower at 3,336.12 points down 0.45 percent.

Turnover was one billion rupees.

Hatton National Bank closed at 170.20 down 1.30 rupees, Commercial Bank closed at 94.30 down 0.50 rupees and DFCC closed at 142.60 down 4.90 rupees.

Sampath Bank which fell 4.90 rupees on Thursday recovered 1.20 rupees to close at 213.50 rupees.

There had been a sell-off in banks over concerns that they were exposed to gold-backed loans with the precious metal plunging amid an overall fall in commodities.

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