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UPDATE 1-Sri Lanka bourse hits record high; rupee slips | Reuters

[Reuters, Friday, 18 December 2009 12:40 No Comment]

Sri Lankan shares .CSE hit a record high of 3188.82 on Friday, surpassing its previous level of 3157.11 hit on 15 October on high volumes, led by foreign buying, traders said.

The All-Share Price Index .CSE of the Colombo Stock Exchange rose 2.09 percent in intraday trade to 3200.26 which intern all time intraday high and closed 1.73 percent or 54.35 points up at 3188.82 its highest ever close.

"Market moved up on buying on across the board," said Asmath Iqbal, investment advisor at John Keells stockbrokers in Colombo.

Analysts said the foreign buying in the past few days has improved investor confidence, which had been declining since the government announced an early national election next year.

The foreign purchase for the week was 5.87 billion rupees, outpacing the foreign sales worth 3.58 billion rupees which helped the market to record a net foreign inflow of 1.15 billion rupees so far for this year.

Market heavyweight John Keells Holdings JKH.CM closed 0.31 percent firmer at 160.50 rupees a share.

Development lender DFCC Bank DFCC.CM closed 3.23 percent firmer at 160 rupees a share while Lion Brewery LION.CM closed 5.53 percent firmer at 71.50 rupees.

The day’s turnover was at 1.14 billion rupees ($9.96 million), mostly driven by local buying, well above last years daily market average of 464 million rupees.

The island nation’s economy grew 4.2 percent in the third quarter from a year earlier, helped by increased activity after the end of a 25-year war and up from a 2.1 percent expansion in the second quarter. [ID:nSGE5BH06A]

Analysts said the investors were getting in to their positions expecting good earnings and also ahead of elections.

On Thursday, Sri Lanka’s election commissioner accepted a record 22 nominations for the January presidential poll, in which economic policies, and not war strategy, are expected to dominate the campaign. [ID:nSGE5BG0CN]

The presidential poll is scheduled for Jan. 26 and it will be followed by parliamentary election due by April.

Analysts and traders said the broader market is still waiting for directions from the economic policies of the main presidential candidates Mahinda Rajapaksa and Sarath Fonseka.

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