August 24, 2017 / 11:59 AM / a month ago

Sri Lankan shares hit over four-month closing low

COLOMBO, Aug 24 (Reuters) - Sri Lankan shares on Thursday hit an over four-month closing low as gains in telecom shares were offset by losses in diversified stocks.

Analysts, however, said the market saw some buying in the latter part of the day after the government said it dropped a proposed tax on profits from share trading that was planned as part of a major tax reform bill.

Junior Finance minister said that Sri Lanka will not go ahead with a proposed tax on profits from share trading that was planned as part of a major tax reform bill.

The bill is expected to be presented in the parliament on Friday.

The Colombo stock index ended little changed, 0.01 percent down at 6,382.54, its lowest close since April 18.

The index shed 4.3 percent since July 27 through Thursday and has fallen in 18 out of 20 sessions on lacklustre corporate earnings in the June quarter and speculation that the new reform bill may impose a tax on stock trading.

“We have seen some local interest coming in to market with the minister clarifying on tax on stock trading,” said Dimantha Mathew, head of research at First Capital Holdings.

Foreign investors bought shares worth a net 43.8 million rupees ($286,461.74) on Thursday, extending the year-to-date net inflows to 27.9 billion rupees.

Turnover was 476 million rupees, less than this year’s daily average of around 860.8 million rupees.

Shares of Nestle Lanka Plc fell 0.6 percent while conglomerate John Keells Holdings Plc ended 0.1 percent lower.

Shares of Dialog Axiata Plc rose 0.9 percent. ($1 = 152.9000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Vyas Mohan)

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