Financial Times

Shares recover after profit taking
Share prices recovered at the end of last week after dipping on profit taking and brokers said investors enthusiastic over future company earnings could still drive the market up again. Turnover for the week was just over a billion rupees with the bourse still dominated by local institutions and retail investors.

Brokers said foreigners were yet to come into the market in a big way but were selectively picking stocks, mainly conglomerates and banks. Naren Godamune of DFCC Stock Brokers said there was more foreign buying than selling last week.
Foreigners bought stocks worth Rs. 230 million and sold Rs. 73 million.

Godamune said that buying interest came back on Friday as the market had fallen to attractive levels earlier in the week. "Although the market looked weak in the morning there was a noticeable rebound later in the day," he said.

"Investors appear to be looking at the future earnings potential of companies." Mahesh Peiris of Asia Capital said the anticipation of good second quarter corporate earnings and further interest rate cuts were likely to keep the stock market buoyant.
Forced selling by buyers who had to meet settlements brought the market down last week, he said.

The All Share Price Index dipped below the 1,000-point mark during three successive days of falls in the middle of the week but regained some lost ground on Friday to close at 992.3.

Some brokers said there might be another bull run towards August as more black money comes into the market ahead of the extended deadline for the end of the tax amnesty. A technical glitch on the Colombo Stock Exchange automated trading system delayed the market opening for several hours on Thursday, restricting trading to just one hour.

Harry J to retire old SLIC hands
By Quintus Perera
Middle-aged employees of the Sri Lanka Insurance Corporation (SLIC) have panicked after their new boss, Harry Jayawardena, told labour union leaders that all those who reach the age of 55 years would have to retire.

No extensions would be entertained, he has reportedly said at a meeting with the Jathika Sevaka Sangamaya (JSS) branch of SLIC after its recent privatization.
The JSS branch, with a 1,000-strong membership at SLIC, was totally against the privatization of the corporation. It was bought by a consortium consisting of Harry Jayawardena's Distilleries Company and the Aitken Spence conglomerate of which he is chairman.

Employees between 53 and 55 years are particularly worried. Around 800 to 1,000 employees would be reaching 55 years within the next six months, a JSS spokesman said. Union representatives have pointed out that the retirement age of the government now stood at 57 years.

A spokesman of the JSS branch told The Sunday Times FT that a delegation met Jayawardena recently to discuss a number of urgent matters. Most of the employees of SLIC have obtained big housing loans on the premise that the recovery of loans would be spread out until they reach 60 years.

With this agreement in place, if they are sent on retirement at 55 years, the loan balance would be recovered from the ETF and other payments due to the employees.

JSS leaders have also called upon Jayawardena to work out an acceptable compensation criteria for those who voluntarily retire prematurely as has been the practice in all other privatizations of government enterprises. Jayawardena had indicated that a decision had not yet been taken.

The JSS spokesman said Jayawardena had indicated that all the facilities enjoyed by the workers would be continued and had assured them that bonuses would also be paid.

The workers also have demanded a salary increase as their salaries had not been raised for the last five years, even though they had an agreement with the SLIC management for salaries to be increased every four years. Jayawardena has indicated that a salary increase would be considered only if there is a government salary increase.

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