Sri Lanka's share market fell more than 2 percent on Monday to a 17-month low, continuing its losing streak for a fifth straight session as retail investors sold off shares to trim leveraged positions and meet margin calls. The main share index ended 118.04 percent, or 2.04 points weaker at 5,663.09, lowest since August 27, 2010.
It is the worst performer among Asian markets with a 6.77 percent loss so far this year. The market has fallen 4.5 percent since opening on Tuesday, the day after the Securities and Exchange Commission allowed brokers to extend more credit to clients, which some brokerages had touted as the cure for the slumping bourse. Retail favourite share PC Pharma fell 3.53 percent to 52 rupees. Shares in John Keells Holdings PLC edged up 0.43 percent to 164 rupees on light trade.
The day's turnover was 827.2 million Sri Lanka rupees ($7.26 million), far below last year's average of 2.3 billion. Volume was 61 million shares. Last year's daily average was a record 102.7 million. Foreign investors were net buyers of 41.9 million rupees worth of shares, but they have sold 364.2 million shares so far this year after 19.1 billion in 2011.
The index lost 8.5 percent in 2011 and was Asia's 10th-best performer after being top in the region until June. It was Asia's best in 2009 and 2010. The rupee closed flat at 113.89/90 to the dollar for a 42nd straight session since a 3 percent devaluation on November 21, with the central bank selling around $30 million to defend it, dealers said.
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