Shares, rupee edge up ahead of manifesto announcements

(Colombo) REUTERS: Sri Lankan shares and the rupee gained on Wednesday, as investors waited for policy manifesto announcements by the two frontrunners for next month’s presidential poll.

Former wartime defence chief Gotabaya Rajapaksa and housing minister Sajith Premadasa will announce their policy framework on Friday and November 1, respectively. Analysts had said that investors were waiting to see policies on tax, subsidies, and private businesses. 

Shares edged up for the fifth straight session and closed at their highest level in more than seven weeks, buoyed by beverage and banking stocks.

The benchmark stock index rose 0.14 percent to 5,888.34, the highest close since August 30, 2019. The index has fallen 2.71 percent so far this year.

Meanwhile, the rupee ended 0.11 percent firmer at 181.40/50 per dollar compared with Tuesday’s close of 181.60/70. The currency is up 0.66 percent so far this year.

Foreign investors were net sellers of riskier assets for the first time in four sessions.

They sold a net 117.5 million Sri Lankan rupees (US$648,097.08) worth of shares, extending the year to date net foreign selling to 3.71 billion rupees of equities, according to index data.

Equity market turnover was 472 million rupees (US$2.60 million), well below this year’s daily average of about 665.4 million rupees. Last year’s daily average was 834.0 million rupees.

Meanwhile, foreign investors sold government securities on a net basis for the eighth time in nine weeks, selling a net 724.9 million rupees worth of government securities in the week ended October 16. Total foreign outflows from government securities through October 16 stood at 55.6 billion rupees, as per the Central Bank data.

Sri Lanka’s Central Bank left its key rates unchanged on October 11 after loosening policy earlier this year, although growth is likely to remain subdued as the economy faces rising global risk.