Sri Lanka stocks pull back but trading dries up

Oct 24, 2008 (LBO) – The deep slide in Sri Lankan shares halted Friday with prices pulling back slightly but trading slumped to just 69.6 million rupees, brokers said. The Colombo bourse stood its ground, albeit on thin volumes, while Asian and Western markets plunged Friday.

Bartleet Mallory Stockbrokers said there had been a net outflow of funds amounting to 345.10 million rupees during the week.

“A high level of selling pressure was exerted by foreigners on all days except on Friday,” they said.

The ASPI had slumped by a massive 168.02 points (8.41 percent) during the week, they said.

SC Securities said that on Thursday the benchmark ASPI had sunk to a 33 month
low of 1,815.17 points (1,817.9 points on January 18, 2006).

The more liquid MPI had fallen to a 47 month low of 2,034.03 points on Thursday (2,039.4
points on November 16, 2004).

To receive instant alerts from LBO on your Dialog mobile type ‘lbo’ and send to 678

The All Share Price Index edged up 0.86 percent (15.56 points) at 1,830.82 while the Milanka closed up 1.40 percent (28.42 points) at 2,062.45.

“It’s a pull-back but trading has dried up,” said Mohan Thangarajah of First Guardian Equities.

Sri Lanka Telecom closed up one rupee at 37 rupees while Distilleries rose two rupees to 53 rupees.

John Keells Holdings gained 50 cents to end at 65 rupees while Dialog Telekom ended flat at 7.75.

Brokers said investors were reluctant to trade because of the economic uncertainty and turmoil in global markets.

The outlook for Sri Lankan stocks remained gloomy because of high interest rates and inflation and anticipated lower corporate earnings.