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Sri Lanka shares end down 0.3-pct

Feb 03, 2012 (LBO) - Sri Lankan shares closed weaker Friday for the fourth straight day in dull trade despite the central bank announcing it was allowing foreign firms to give margin loans for share trading, brokers said. SC Securities said the main contributor to turnover was trading in Commercial Bank which closed at 100.50 rupees, down 1.20.

Lanka Securities said the Colombo bourse experienced "another lackluster week with noteworthy dips in the indices."

The ASI dipped by 139.05 points or 2.43 percent during the week in which foreign investors were net buyers with a net foreign in flow of 127.71 million rupees.

Acme Printing & Packaging were also actively traded, closing at 23.70 rupees, down 1.20. The main All Share Price Index closed down 0.34 percent (19.10 points) at 5,586.39, while the more liquid Milanka index fell 0.58 percent (27.99 points) to close at 4,813.12.

Turnover was 420 million rupees, according to stock exchange provisional figures.

Allowing foreign entities to give credit for stock trading was one of the requests made by Colombo's stock brokers to prop up the market, when they met President Mahinda Rajapaksa in December.

The markets regulator has also relaxed credit rules after the brokers' meeting with the president, another of their main demands, though its chairperson quit shortly after the meeting.

Sri Lanka's Central Bank on Friday also hiked rates by 50 basis points to 9.0 percent mounting an interest rate defence of its peg with the US dollar.

Friday's share trading session was only two and a half hours as Friday was declared a half-day because of Independence Day which falls on Saturday.

Environmental Resources Investments W0002 warrants, which had plunged the two previous days, were the day's top gainer and most actively traded stock, rising 1.30 rupees to end at 2.90.

The Securities and Exchange Commission has said the warrants will not be allowed to trade after February 03, 2012 following the company's decision to delay their conversion.

Environmental Resources Investments shares were the third most actively traded stock, closing at 27.10 rupees, up 1.10.

Index heavyweight John Keells Holdings lost 30 cents to end at 167.20 rupees.

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