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Sri Lanka share rally interrupted by profit-taking

Apr 27, 2010 (LBO) - Sri Lankan stocks eased Tuesday, interrupting a near unbroken month-long rally, dragged down by a fall in banking stocks while the price of a plantations company with rubber shot up, brokers said. "Malwatte Valley Plantations rose significantly today given its close to 30 percent exposure to rubber," said Tissera.

Rubber prices have risen on a recovery in demand, especially from the automobile industry, as well as higher oil prices which makes synthetic rubber more expensive.

There was an outflow of foreign funds with foreign buying worth 225 million rupees and sales of.787 million rupees.

Asia Capital was the most actively traded stock, ending at 22 rupees, up 3.25 with 2.4 million shares traded.

John Keells Hotels was also actively traded, closing at 20.25 rupees, down 50 cents, along with Colombo Lanka & Development Company which ended at 9.25 rupees, up 1.25. The All Share Price Index closed at 4,134.46, down 0.04 percent (1.59 points) while the more liquid Milanka index fell 0.18 percent (8.58 points) to close at 4,694.98.

Turnover was two billion rupees, according to stock exchange provisional figures.

Indices were down due to profit-taking after a month's bull-run with an exception on April 15 where the ASI fell three points, said Nikita R Tissera, manager - research at SC Securities.

"The fall in shares were seen basically from the banking sector."

Commercial Bank closed at 241.25, down 3.75, and National Development Bank ended at 220 rupees, down 25 cents.

"We believe this is a temporary profit-taking glitch," said Tissera. "We’ve had a bull run from the first of April with just one small correction in the middle."

Investors betting on a rally in prices of natural rubber drove up the share price of Malwatte Valley Plantations, which ended at 56.25 rupees, up 4.25 rupees or eight percent.

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