Sri Lankan stocks picked up on Tuesday on speculative buying a day after a sharp drop on a political alliance between two main political parties that could delay peace talks with Tamil Tiger rebels.
The key Colombo all-share index closed up a provisional 1.02 percent, or 11.05 points, at 1,094.72 points.
Turnover was at 99 million rupees with foreign purchases of 13.4 million rupees and sales of 5.2 million rupees.
The opposition People's Alliance and the Marxist People's Liberation Front formed an alliance on Tuesday promising to take on the government, which they say has given too many concessions to Tamil Tiger rebels.
"The overall trend could be downwards," one broker said.
Second-largest listed John Keells Holdings Ltd fell 0.98 percent, or one rupee, to 101 rupees, on 140,000 shares, following a 10 percent tumble on Monday.
The conglomerate has interests ranging from tourist resorts to plantations, and its share is off a high of 150 rupees in October last year.
Largest-listed Sri Lanka Telecom Ltd rose 1.3 percent, or 0.25 rupees, to 19.25 rupees, on 461,000 shares.
The market lost 25 percent of its value after President Chandrika Kumaratunga grabbed control of three ministries late last year, although it still finished up 30 percent for the year.