COLOMBO: Sri Lankan shares fell for a fifth straight session on Monday to close at their lowest in nearly three weeks, led by large caps, as an order to reverse a share transaction weighed on sentiment despite foreign inflows.
Sri Lankan Prime Minister Ranil Wickremesinghe has ordered a reversal and a probe into the 1.3 billion rupees ($8.7 million) Seylan Bank foreign deal as it failed to follow proper procedure, the country's finance minister said on Monday.
The transaction of 13 million shares or 7 percent stake in Seylan Bank, owned by state-run Bank of Ceylon, went through on Friday and a foreign fund bought the shares at 100 rupees each, a 17.6 percent premium to the stock's closing price that day.
The Colombo stock index ended 0.29 percent weaker at 6,250.57, its lowest close since Nov. 30. The bourse has fallen 1.4 percent in five straight sessions through Monday.
"This is year-end market trading, but the news on reversal of Seylan Bank shares is not good for the market," a stockbroker said asking not to be named.
Shares in Seylan Bank closed 5.5 percent higher at 89.70 rupees on Monday, on speculation the foreign fund may buy more shares from the market at a premium to its closing price of 85 rupees a share on Friday, two stockbrokers said.
Turnover stood at 260.7 million rupees ($1.75 million), around a third of this year's daily average of around 750 million rupees.
Foreign investors bought a net 66.1 million rupees worth of shares on Monday, extending the year-to-date net foreign inflow to 1.94 billion rupees worth of equities.
Shares in Ceylon Tobacco Company fell 1.16 percent, while top private lender Commercial bank of Ceylon lost 1 percent to drag down the overall index.
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