COLOMBO, July 25 (Reuters) - Sri Lankan shares fell on Monday as investors sold large-cap shares like Ceylon Tobacco Company Plc while turnover slumped to a near-three-week low as investors awaited directions on the country's economic policy.

The benchmark Colombo stock index ended down 0.49 percent at 6,397.09, slipping from its highest close since June 21 hit on Friday.

ADVERTISEMENT

"Investors are taking a look at where the market is going. It's just the direction that is required right now," said Yohan Samarakkody, head of research, SC Securities (Pvt) Ltd.

"Investors are waiting for the prime minister's statement and any clues on the next budget. Quite a lot of uncertainty will be cleared off then."

Analysts said investors have been waiting for direction on the country's economic policy, expected to be announced by Prime Minister Ranil Wickremesinghe next month.

Turnover stood at 285.9 million rupees ($1.96 million), the lowest since July 5 and well below this year's daily average of around 731.6 million rupees.

ADVERTISEMENT

Overseas investors bought a net 58.1 million rupees worth of shares on Monday, but have been net sellers of 4.8 billion rupees worth of equities so far this year.

Shares in Ceylon Tobacco Company Plc fell as much as 3.12 percent while food and beverage maker Nestle Lanka Plc fell 3.33 percent and leading mobile phone operator Dialog Axiata Plc fell 2.73 percent, dragging the overall index down. ($1 = 145.5000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil Nair)