Reuters – Sri Lankan shares closed weaker for the fourth straight session on Monday, weighed down by foreign sell-offs and profit-taking in construction shares, while the rupee ended steady. ** The benchmark stock index closed down 0.75% at 6,103.63, its lowest since Nov. 26. The bourse fell 1% last week, but is up 1.61% for the year. ** The index touched its highest level since June 25, 2018 on Dec. 2, lifted by hopes of booming economic activity after the new government cut some key taxes. ** The Sri Lankan rupee ended steady at 181.10/30 per dollar, Refinitiv data showed. It is up 0.8% so far this year. ** Analysts said the tax reduction has already been factored in and the market was waiting to see the impact of the new policy. They said investors sold shares that rose on hopes the new government will encourage an economic boom led by construction. ** “We see a profit taking in construction sector shares, which jumped on construction boom hopes,” said Atchuthan Srirangan, assistant research manager at First Capital Holdings Plc. “There was no negative news and when investors see in values in shares, they will come again and buy.” ** The government on Nov. 27 reduced value-added tax to 8% from 15% effective Dec. 1, and abolished some other taxes as well in its attempt to boost economic growth that has fallen to a near two-decade low. ** Singapore-based research firm Emerging Asia Economics in a note last week said the tax cut decision would provide a significant boost to the economy, but put increased strain on the country’s fragile public finances, with a possible loss of $2 billion in revenue. ** Foreign investors were sellers on Monday in the equity market for the 28th session out of the last 31. ** They sold a net 141 million Sri Lankan rupees ($783,333) worth of shares on Monday, extending the year-to-date foreign outflow to 11 billion rupees, according to index data. ** Equity market turnover was 435.5 million Sri Lankan rupees, less than this year’s daily average of about 726 million. Last year’s daily average was 834 million rupees. ** Foreign investors were net sellers of government securities on a net basis for the first week in seven, selling a net 4.2 billion Sri Lankan rupees worth of government securities in the week ended Dec. 4. ** Total foreign outflows from government securities through Nov. 27 stood at 47.9 billion rupees, according to central bank data.
The post Sri Lanka shares fall for 4th straight session; rupee steady appeared first on Adaderana Biz English | Sri Lanka Business News.
adaderana business