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Sri Lanka bourse lifts from 22-month low on bargain hunting
May 30, 2012 / 12:26 PM / 5 years ago

Sri Lanka bourse lifts from 22-month low on bargain hunting

* Market snaps 7-session losing streak

* Foreign investors net sellers fist time in 11-sessions

* Rupee weaker on importer dollar demand

COLOMBO, May 30 (Reuters) - Sri Lanka’s stock market rose on Wednesday for the first time in eight sessions as investors snapped up discount shares after month-end settlements and margin calls.

The main index rose 0.79 percent, or 37.90 points, to 4,851.16, up from its lowest close since July 20, 2010.

“There has been some bargain hunting,” said one stockbroker, speaking on condition of anonymity. “It seems the month end settlements are over and (we have) seen some buying coming in.”

The bourse had lost 7.8 percent in seven consecutive sessions until Wednesday, as mostly retail investors unloaded their stakes as a result of concerns about new regulatory measures, uncertainty over the rupee currency, rising interest rates, and slowing economic growth.

Last week, the Securities and Exchange Commission (SEC) issued a rule barring brokers from selling shares for six months from the day of buying, a move which triggered selling.

Foreign investors sold a net 110.4 million rupees worth of shares on Wednesday, but they have been net buyers of 22.5 billion so far this year. Turnover was 673.7 million rupees.

The market is one of the worst performers in Asia, having fallen 19.91 percent since the start of the year.

The rupee fell to 132.40/60 against the dollar on Wednesday, its lowest since April 25, from Tuesday’s close of 132.00/10 on importer demand for dollars in light trade.

$1 = 132.50 Sri Lanka rupees Reporting by Ranga Sirilal and Shihar Aneez; Editing by Daniel Magnowski

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