November 8, 2017 / 12:25 PM / a year ago

Sri Lankan stocks steady ahead of budget; turnover at 7-week high

COLOMBO, Nov 8 (Reuters) - Sri Lankan shares ended steady on Wednesday with turnover hitting a seven-week high on foreign selling in United Motors Lanka, while all eyes are on the 2018 budget presentation scheduled on Thursday.

Sri Lanka’s coalition government will seek to stoke exports and employment through support for the small businesses in its 2018 budget, a move that is likely keep the island nation’s fragile public finances under pressure.

The Colombo stock index closed 0.04 percent up at 6,598.26, recovering from its lowest level since Oct. 24 hit in the previous session.

The turnover was 3.35 billion rupees ($21.85 million), its highest since Sept. 15 and more than three times this year’s average of around 950 million rupees.

Foreign investors sold shares worth net 2.2 billion rupees in the session, mainly in United Motors. They are net buyers of shares worth 18.1 billion rupees so far this year.

“The market is awaiting the budget. The United Motors deal boosted the turnover,” said Jaliya Wijeratne, CEO at First Capital Equities.

Finance Minister Mangala Samaraweera will present the 2018 budget on Thursday at 0930 GMT.

Samaraweera announced tax concessions worth a monthly 1.5 billion rupees ($9.8 million), a day ahead of the budget, which is expected to focus on exports and fiscal consolidation.

Shares in United Motors Lanka, which accounted for 71.5 percent of the day’s turnover, rose 2 percent.

In a disclosure to the bourse, RIL Property Ltd, which gained 4.2 percent, said it has acquired 30 percent stake in United Motors at 78 rupees a share. ($1 = 153.3000 Sri Lankan rupees) (Reporting by Shihar Aneez; Editing by Vyas Mohan)

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