The benchmark Colombo All Share Price Index (ASPI) closed down 0.38 percent to end at 2,501.19 (9.62 points), while the Milanka index of liquid stocks dropped 0.
95 percent (26.93 points) to close at 2,816.66, according to provisional stock exchange data.
The US dollar spiked briefly to 115.
00/05 rupees in late trading, deviating from the steady 114.90 levels seen for the past several months.
Turnover in equities was 456.4 million rupees.
During the week the ASPI was down 1.
12 percent, while the Milanka Index of liquid stocks lost 2.56 percent.
On Friday there were net foreign outflows worth 97.0 million rupees, with foreign investors buying 260.
2 million worth shares and selling shares valued at 163.2 million rupees, brokers said.
"The fall of the market was mainly attributed to fall in value of Dialog shares," Thakshila Hulangamuwa, vice president, business development at Asha Phillip Securities said.
"The weak market sentiment was continued with the unimpressive midyear accounts.
"
Kitchen Sink
Index heavy blue chip celco Dialog Telekom, the Sri Lankan unit of Telekom Malaysia made a 7.6 billion rupees loss for June quarter 2009, reporting the largest quarterly corporate in Colombo stock exchange history.
Dialog threw in a 6.0 billion write down in a classic 'kitchen sink quarter', move.
The firm said it was writing off a chunk of network equipment which was becoming obsolete with a move to more modern next generation network (NGN) which was cheaper to run.
Dialog closed at 5.25 rupees, down 50 cents (8.7-pct) on 2.92 million shares that changed hands today, while fixed line operator Sri Lanka Telecom which also had poor June quarter earnings closed flat at 42.
00.
A 341,000 parcel Nestle, traded at 350.
00 rupees and the stock closed at 350.00 rupees, up 1.00, while 487,000 Ceylinco Insurance shares changed hands at 230.00 rupees and closed at 229.50 rupees, up 50 cents, brokers said.
Retail favourite Lanka Cement closed at 30.00 rupees, down 1.00, while Lanka IOC, a unit of Indian Oil Corporation which posted a 856 million rupee loss for the June quarter, closed flat at 16.00 rupees.
Index heavy conglomerate John Keells Holdings closed at 130.
25 rupees, up 25 cents, Distilleries Company of Sri Lanka, a unit of unlisted tea company Stassens Group controlled by business tycoon Harry Jayawardena closed at 85.50 rupees, down 50 cents.
Commercial Bank of Ceylon closed at 143.
50 rupees, up 2.00, while Chevron Lubricans Lanka Limited, the Sri Lankan unit of US based petroleum multinational Chevron closed at 135.00 rupees, up 3.00.
"The movements in the market would be sluggish in the short term as a lot of companies are publishing their June earning results during this period which is not really upbeat," Hulangamuwa said.
"However the market can be expected to adjust towards end of August."
National Development Bank closed flat at 167.00 rupees despite reporting xx percent increase in quarter profit, while DFCC Bank closed at 136.75 rupees, down 25 cents.
Sampath Bank closed at 137.00 rupees, up 1.50, and Nations Trust Bank, a unit of JKH closed at 30.50 rupees, down 25 cents.
Seylan Bank, closed at 31.25 rupees, up 25 cents.
Diversified Hayleys closed at 136.50 rupees, up 50 cents and Hemas Holdings which has significant exposure to pharmaceutical business closed at 106.75 rupees, up 75 cents.