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Shares hit over 3-week closing high in lean trade

Shares hit over 3-week closing high in lean trade

Reuters: Shares rose for a fifth straight session on Tuesday and marked their highest close in more than three weeks, led by gains in banking and beverage stocks.

However, trading volume was low as investors stayed on the sidelines for want of fresh triggers. The day’s turnover stood at Rs. 181.9 million ($ 1.12 million), the lowest since 3 August and less than a fifth of this year’s daily average.

The Colombo stock index ended 0.6% higher at 6,128, its highest close since 13 August. It had gained 0.4% last week, its second straight weekly gain.

The index, however, was down 1.1% in August, having hit its lowest close since March 2017 on last Tuesday. The Bourse is down 3.8% so far this year.

“Most investors are awaiting proper direction on economy and taxes,” said Dimantha Mathew, head of research at broker First Capital Holdings.

“The main concern is that foreign selling is still continuing and we don’t think this uptrend can continue for long.”

Foreign investors sold a net Rs. 31.3 million of shares on Tuesday, extending their net outflow so far this year to Rs. 4.2 billion worth of shares.

AIA Insurance Lanka Plc jumped 82%, with around 1,700 shares changing hand, due to a share buyback, dealers said.

Ceylon Tobacco Company Plc shares closed 2.5% firmer while Dialog Axiata Plc gained 0.8% and Hemas Holdings Plc ended 0.5% higher.

Sri Lankan companies posted an average 4% earnings growth in the June quarter from a year earlier, helped by financials, beverages, telecommunications and power and energy sectors, CT CLSA Securities Ltd. said in a research note.

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