Foreign investors were net sellers of 671.7 million rupees ($5.08 million) worth of shares on Tuesday, the highest since Jan. 30. Foreigners have been net buyers of 18.63 billion worth of shares so far this year.
Before the market opened, the central bank kept key policy rates unchanged and said the country has the potential to achieve its targeted 7.5 economic growth this year.
The main share index edged down 0.43 percent, or 24.86 points, to close at 5,705.26, its lowest close since Sept. 10. It touched a near two-week high on Friday.
Brokers said the market has been concerned about the interest rate outlook after an expensive borrowing by state-owned National Savings Bank.
Shares in large caps dropped, with Carsons Cumberbatch PLC falling 5.25 percent and Cargills (Ceylon) PLC ending down 7.41 percent.
Tuesday's turnover was 913 million rupees, more than this year's daily average of about 883 million rupees.
($1 = 132.2500 Sri Lanka rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Prateek Chatterjee)
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