March 5, 2019 / 12:52 PM / 3 months ago

Sri Lanka shares recover on bargain hunting; rupee gains

COLOMBO, March 5 (Reuters) - Sri Lankan shares rose on Tuesday, recovering from a more than five-year closing low hit in the previous session, as investors picked up battered stocks, and 2019 budget proposals to increase spending and cut fiscal deficit boosted sentiment, analysts said. ** The rupee closed firmer on inward remittances and dollar selling by exporters. ** Sri Lankan Finance Minister Mangala Samaraweera on Tuesday presented the 2019 budget that raises spending while setting an ambitious goal to reduce the country’s large fiscal deficit. ** The IMF has agreed to extend Sri Lanka’s $1.5 billion loan programme by one year and has reached staff level agreement to disburse the sixth tranche of the loan. ** The Colombo Stock Exchange index closed 0.28 percent firmer at 5,770.57, edging up from its lowest close since Nov. 28, 2013 hit on Friday. Markets were closed on Monday for a holiday. ** The benchmark stock index fell 1.43 percent last week. It declined 2.9 percent in February, its second straight monthly fall. ** Turnover was 1.2 billion rupees ($6.71 million), more than last year’s daily average of 834 million rupees. ** The rupee ended firmer at 179.00/25 per dollar, compared with Friday’s close of 179.70/85. ** Foreign investors exited from government securities for the second straight week in the week ended Feb. 27, with net sales of 3.4 billion rupees, the central bank’s latest data showed. ** The rupee has climbed 2 percent so far this year as exporters converted dollars and foreign investors purchased government securities amid stabilising investor confidence after the country repaid a $1 billion sovereign bond in mid-January. ** Worries over heavy debt repayment after the 51-day political crisis that resulted in a series of credit rating downgrades dented investor sentiment as the country struggled to repay its foreign loans. ** The rupee dropped 16 percent in 2018, and was one of the worst-performing currencies in Asia due to heavy foreign outflows. ** For a report on global markets, click ** For a report on major currencies, click ($1 = 178.8500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

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