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Dhaka stocks advanced last week as a section of investors went for bargain hunting while many others remained cautious due to the country’s dismal macroeconomic performance.
DSEX, the key index of Dhaka Stock Exchange, increased by 1.9 per cent, or 89.01 points, over the week to close at 4,771.92 points on November 7, the last trading session of the week, after slumping to a three-year low on October 29.
The market started the week on a positive note after several dismal weeks and close on the same note despite a fall in the DSEX in the second trading session of the week.
The downward trend in recent months resulted in the DSEX losing more than 1,200 points.
Market operators said lucrative prices and the upcoming corporate declarations of companies which are expected to declare better earnings reports prompted a section of investors to buy shares.
Besides, the Bangladesh Securities and Exchange Commission’s announcement to impose ceiling on the share prices of companies from their very first trading session brought some relief to a section of investors, they said.
Investors have been complaining that sharp rise in share prices of newly listed companies in the first several trading sessions helped IPO-hunters ditch shares on the secondary market and thus resulted in a fund leakage from the capital market.
In last week, share prices of 221 out of the traded 355 companies advanced, 112 declined and 22 remained unchanged.
Although the market rebounded in the week, investors’ cautiousness was reflected in their participation, market operators said.
The daily average turnover on the DSE dropped to Tk 331.77 crore over the past week from Tk 334.77 crore in the previous week.
Dismal microeconomic performance kept investors cautious as the Centre for Policy Dialogue on November 3 said that the macroeconomic stability of the country had now become weaker and performance of economic indicators was under tremendous pressure, which might lead to a structural slowdown in the economy.
Concerning the country’s stock market, the CPD identified five institutional and governance related weakness — poor quality initial public offerings, anomalies in financial reporting, lack of transparency in BO accounts, suspicious trading at secondary market and questionable role of institutional investors.
EBL Securities, in its weekly market commentary, said, ‘Investors are still taking cautious stance as participation remained moderate throughout the week.’
Due to a volatile market outlook, the index is not showing stable performance according to expectations of the intermediaries, it said, adding that the regulatory reforms were required to sustain the market’s overall performance and boost confidence among investors.
Shariah index of the bourse, DSES, rose by 1.31 per cent, or 14.09 points, over the week to close at 1,089.57 points.
DS30, the blue-chip index of the DSE, gained 1.85 per cent, or 30.17 points, to close at 1,657.92 points.
National Tubes led the turnover chart for the second consecutive week with its shares worth Tk 80.93 crore traded over the week.
The other turnover leaders in the week were Sonar Bangla Insurance, BRAC Bank, VFS Thread Dyeing, Fortune Shoes, Shurwid Industries, Standard Ceramic Industries, Square Pharmaceuticals, Northern Jute Manufacturing and Stylecraft.
Hakkani Pulp and Paper gained the most in the week with a 35.07-per cent increase in its share price while Rahim Textile Mills performed the worst, losing 14.62 per cent.
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