Bourse turnover slumps to near 5-year low but Index snaps losing streak

Bourse turnover slumps to near 5-year low but Index snaps losing streak
REUTERS: Sri Lankan shares edged up on Monday, ending a five-session falling streak, but turnover slumped to near a 5-year low as investors were cautious ahead of a UN resolution on the island nation’s human right records later this month.
The day’s turnover fell to 2009 levels when the island nation was in the final days of a 26-year civil war with Tamil separatists. Turnover was Rs. 90.9 million ($ 696,300), the lowest since April 30, 2009, less than a tenth of this year’s daily average of about Rs. 921.3 million.
Analysts said investor sentiment has been dented on concerns over the UN resolution, which could have an impact on the country’s economy. Many potential buyers in risky assets are staying on the sidelines for want of clear direction.
“Now, foreign investors are also holding back because there is no liquidity in the market,” Danushka Samarasinghe, head of TKS research, told Reuters.
The main stock index rose 0.3%, or 17.88 points to 5,914.11, edging up from its lowest close since 26 February led by large caps.
Ceylon Tobacco Co PLC shares rose 1.83% to Rs. 1,120 with just one share changing hands, while Ceylinco Insurance PLC rose 7.40% to Rs. 1449.90 with just nine shares traded, Thomson Reuters data showed.
Foreign investors were sellers for the second straight session, with net selling of Rs. 4.89 million worth of shares on Monday. But they have been net buyers of Rs. 220 million worth of shares in the last nine sessions.
Net outflows so far in 2014 stand at Rs. 3.82 billion. They were Rs. 22.88 billion in 2013.
Earlier this month, Sri Lanka questioned the independence of the human rights office of the United Nations after the United States asked it to investigate violations by the Sri Lankan Government related to the civil war. A vote on the resolution is scheduled for the last week of the session, starting on 24 March.