Sri Lankan stocks closed slightly higher on Wednesday after two days of losses, as small investors bought select shares looking for gains in the coming days, brokers said. The key Colombo all-share index rose a provisional 0.51 percent, or 8.67 points, to 1,703.78 points. The bourse has gained almost 13 percent on hopes for upbeat corporate earnings due for releaste in the coming weeks and gains in the construction sector seen benefiting from post-tsunami rebuilding. The Milanka index - which tracks the most liquid and highly capitalised stocks - fell a provisional 0.33 percent, or 7.74 points, at 2,336.31 points.

Arpico Finance Co Ltd rose 44 percent to 36 rupees after heavy small investor buying pushed the stock higher.

Importer Muller and Phipps (Ceylon) Ltd rose 22.73 percent to 6.75 rupees on foreign buying.

Retail fuel giant Lanka IOC rose 0.98 percent to 51.75 rupees.

Brokers recommend investors hold the stock with a long-term view. Total market turnover was 315.96 million rupees with foreign purchases of 44 million rupees and 57 million rupees in foreign sales.

Copyright Reuters, 2005