Sri Lankan stocks were steady in thin trade on Monday as political uncertainty ahead of the presidential polls early next year weighed on the sentiment and many investors were on holidays ahead of Christmas.

The main stock index was up 0.09 per cent at 7,259.06 at 0654 GMT. It had hit a two-week closing high on Friday.

“Many investors are on holiday and retailers are staying away due to political uncertainty,’’ a stockbroker said on condition of anonymity. “The index will move sideways until the New Year.’’

Turnover stood at 408.4 million rupees ($3.11 million), with 26.8 million shares changing hands.

Political analysts see a tight race between President Mahinda Rajapaksa and former health minister Mithripala Sirisena, the consensus candidate of a united Opposition.

Sirisena in his policy announcement on Friday had said that he would eliminate rampant corruption and reduce the prices of essential goods and fuel by cutting taxes.

Rajapaksa is yet to announce his policies and manifesto.

In the forex market, four-day rupee forwards were steady at 131.99/132.03 per dollar at 0705 GMT on moral suasion by the central bank, dealers said.

“Today, the market saw three-day rupee forwards trading after a long time,’’ a currency dealer said.

Three-day forwards, or spot-next, traded at 131.99/9975 at 0709 GMT, dealers said.

The spot currency was not traded.

($1 = 131.4000 Sri Lankan rupees)

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