Shares close little changed in dull trade; tax bill weighs on market

RETUERS: Sri Lankan shares closed little changed in low turnover yesterday as investors waited for clarity on the new tax bill.

The parliament passed tax reforms on Thursday that should simplify the tax system, widen the tax base and increase government revenue, as agreed with the International Monetary Fund in exchange for a US $ 1.5 billion, three-year loan.

The Colombo stock index ended 0.06 percent weaker at 6,372.24, snapping two straight sessions of gains.

Turnover was Rs.290.8 million, the lowest since August 28 and well below this year’s daily average of around Rs.856.5 million.

The Colombo stock index fell 0.2 percent last week, its eighth straight weekly drop.

“Investors are still waiting to see the clarifications on the tax bill and the exact implications of the bill,” said First Capital Holdings Head of Research Dimantha Mathew.

Shares of Ceylon Tobacco Co PLC fell 0.6 percent, while Overseas Realty Ceylon PLC ended 2.67 percent weaker.

Foreign investors net bought Rs.49.4 million worth of shares, extending the year-to-date net foreign inflow to Rs.27.8 billion worth equities.