The main share index rose 2.38 percent or 133.04 points to 5,725.44, highest since Jan. 23. It has risen 3.04 percent in last two sessions.

Foreign investors booked profits while local institutional investors bought blue chips like Commercial Bank of Ceylon , which rose 4.00 percent to 104 rupees on foreign selling of 2.2 million shares.

The island nation's bourse returned to neutral territory with the Relative Strength Index at 41.210 from Thursday's oversold region of 27.965, in between the lower neutral range of 30 and upper neutral range of 70, Reuters data showed.

But it is still the worst performer among Asian markets with a 5.75 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009 and 2010.

Net foreign sales on Friday were 157.3 million rupees, but offshore investors are net buyers of 751.2 million so far this year, after net outflows of 19.1 billion last year and a record 26.4 billion in 2010.

Conglomerate Aitken Spence PLC rose 3.2 percent to 113 rupees, a day after it said that it would realise a capital gain of 630 million rupees on the sale of its 30 percent stake in Colombo harbour container terminal joint venture.