The Sri Lankan rupee ended weaker on Wednesday as outflows from government securities and stocks due to political uncertainty raised dollar demand.
** Stocks fell for the third session running, hitting a one-week closing low and moving further away from their near two-month closing high hit last week, as the political crisis continued after the speaker of parliament said on Monday he would not recognise President Maithripala Sirisena’s sacking of Ranil Wickremesinghe and appointment of Mahinda Rajapaksa as the prime minister.
** Sri Lanka’s parliamentary speaker has called the president’s sacking of the prime minister to bring a former leader back to power a non-violent coup d’etat.
** The rupee ended at 174.80/175.10 per dollar on Wednesday, compared with the previous close of 174.45/60. The rupee has weakened 1 percent since the political crisis began on Oct. 26.
** The rupee hit a record low of 175.65 per dollar on Thursday.
** The rupee weakened 3.7 percent in October after a 4.7 percent drop in September against the dollar. It has dropped 13.8 percent so far this year.
** Foreigners bought a net 298 million worth stocks on Wednesday. They have offloaded equities worth 6.8 billion rupees since the political crisis started on Oct. 26. ** Since the prime minister’s sudden sacking, 6.7 billion rupees has flowed out of the stock market, while the bond market saw an outflow of around 11 billion rupees between Oct. 25-31, central bank data showed. So far this year, the island nation has seen 16.2 billion rupees in outflows from stocks and 100.8 billion rupees from government securities, bourse and central bank data respectively showed ** The Colombo stock index fell 1.24 percent to 5,987.21, its lowest close since Oct. 31. It hit a near two-month high on Thursday. The bourse rose 4.5 percent last week due to heavy retail investor participation. It has slipped 6 percent so far this year. ** For a report on global markets, click here and for a report on major currencies, click ** Stock market turnover was 1.3 billion rupees ($7.45 million) on Wednesday, more than this year’s daily average of 817.1 million rupees.
** Shares of conglomerate John Keells Holidngs Plc fell 3.3 percent, the country’s biggest listed lender, Commercial Bank of Ceylon Plc, declined 5.1 percent and Hemas Holdings Plc lost 5.8 percent.
Source-Reuters, Ada derana