Sri Lanka's bourse hit a new record high on Thursday as institutional investors started buying in large quantities after the International Monetary Fund approved the island nation's loan tranche with positive comments. The island's main share index touched a new intraday high of 7,367.41 before closed 1.16 percent or 84.55 points firmer at a record close of 7,346.81, surpassing Wednesday's record close of 7,262.26.
Foreign investors sold a net 119.6 million rupees' worth shares on Thursday and have sold a net 3 billion rupees so far in 2011, after selling a record net 26.4 billion in 2010. Traded share volume was 136.6 million, against a five-day average of 102.6 million. The 30-day and 90-day average trading volumes were 88.3 million and 71.8 million respectively. Last year's daily average volume was 69.2 million.
The bourse has been Asia's best performer with a 10.71 percent gain in 2011 after being the top performer last year with a 96 percent return. Recent retail buying has pushed it deeper into the overbought region with the 14-day relative strength index at 79.8. The bourse is trading at a forward price-to-earnings (P/E) ratio of 17.2, one of the highest among emerging markets, compared with 13 in Asian markets and 11.9 in global emerging markets, Thomson Reuters StarMine data showed. Turnover was 4.7 billion rupees ($37.3 million), more than last year's daily average of 2.4 billion. The rupee closed weaker at 110.95/111.05 a dollar.