COLOMBO, March 30 (Reuters) - Sri Lankan shares rose for a third straight session on Thursday, closing at their highest in more than one week, helped by foreign investor buying and quarter-end window dressing, stockbrokers said.
The Colombo stock index closed 0.31 percent firmer at 6,040.18, its highest close since March 21.
On Monday, it had closed at its lowest since March 15, 2016 after the central bank tightened its monetary policy on Friday by 25 basis points to contain high inflationary expectations.
Stockbrokers said rising interest rates have kept most investors on the sidelines. Yields on treasury bills rose 6-16 basis points at a weekly auction on Wednesday.
"Local buying demand is increasing and the market is moving up on blue chips. Buying interest from the retail side is slowly improving," said Dimantha Mathew, head of research, First Capital Equities (Pvt) Ltd.
"Local buying interest has now started to improve but the foreign side is still dominating."
Foreign investors net bought shares worth 200 million rupees ($1.32 million) on Thursday, raising the year-to-date net foreign inflow to 4.58 billion rupees in equities.
Turnover stood at 1.18 billion rupees, well above this year's daily average of 718.3 million rupees.
Shares of Nestle Lanka Plc jumped 4.46 percent, Ceylon Theatres Plc rose 10.30 percent, Ceylon Cold Stores Plc gained 0.82 percent, and Commercial Bank of Ceylon Plc, the country's biggest listed lender, ended up 0.93 percent. ($1 = 151.8500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)