Institutional support helps jack up market
The market broke the seven-day losing streak on Thursday, with turnover hitting a three-month low, as some large-cap stocks added strength to the index in the later part of the session.
Following the week-long bearish trend, the market witnessed see-saw movement several times before closing higher on the day.
After witnessing high volatility, DSEX, the prime index of the Dhaka Stock Exchange (DSE), went up 55.61 points or 0.79 per cent to finish at 7,076, after losing more than 347 points in the past seven trading days.
Two other indices also ended higher. The DS30 index, comprising blue chips, jumped 43.28 points to close at 2,699. The DSE Shariah Index (DSES) rose 13.24 points to finish at 1,518.
Turnover, the most important indicator of the market, also fell to Tk 13.11 billion, registering a decline of 22 per cent over the previous day’s turnover of Tk 16.82 billion.
It was the lowest daily turnover in three months since July 19, when turnover was recorded Tk 12.64 billion.
Market analysts said late hours’ buying pressure from institutional investors on selective large-cap stocks helped the market to nudge higher.
Institutional investors, including the state-run Investment Corporation of Bangladesh, supported the market from the front while small investors remain on the sidelines, said a merchant banker.
The general investors were mostly inactive and not confident enough to put in fresh funds, taking the market turnover to three months low, he said.
He noted that some big investors took position on miscellaneous, banking and pharmaceutical sectors in the later part of the session.
The retail investors remained mostly cautious as participation has been decreasing in the last few days, he said.
The heavyweight market-cap stocks such as Beximco, Beximco Pharma witnessed increased buying pressure just ahead of the closing of the session, which added strength to the index to stay afloat, commented EBL Securities.
With a view to build-up the market momentum and to increase market liquidity, the stock market regulator has allowed brokerage firms and merchant banks to raise funds through the issuance of bonds.
The market intermediaries will utilise bond proceeds to invest in the stock market and provide margin loans to investors.
Top positive index contributors were Beximco, Grameenphone, Beximco Pharma, ICB, Square Pharma, NRB Commercial Bank and LafargeHolcim, jointly contributed more than 50 points to the DSEX, according to amarstock.com, a market data analyst.
Major sectors posted gain with the miscellaneous sector generated the highest gain of 4.70 per cent riding on sector heavyweight Beximco, followed by financial institutions with 1.10 per cent, pharma 1.0 per cent, power 0.80 per cent, telecom 0.70 per cent and banking 0.20 per cent.
A total number of 176,258 trades were executed in the day’s trading session with trading volume of 272.95 million securities.
The total market capitalisation of the DSE stood at Tk 5,698 billion, up from Tk 5,668 billion in the previous trading session.
Losers, however, took a modest lead over the gainers, as out of 374 issues traded, 179 closed lower, 153 higher and 42 remained unchanged on the DSE trading floor.
Beximco topped the day’s turnover chart with 18.86 million shares of Tk 2.86 billion changing hands, followed by IFIC Bank (Tk 645 million), NRB Commercial Bank (Tk 593 million), Delta Life Insurance (Tk 532 million) and Orion Pharma (Tk 519 million).
NRB Commercial Bank was the day’s top gainer, posting a gain of 9.84 per cent while Mithun Knitting was the day’s worst loser, plunging by 7.18 per cent.
The Chittagong Stock Exchange (CSE) also rebounded on the gaining streak with the CSE All Share Price Index – CASPI -rising 172 points to settle at 20,693 and the Selective Categories Index – CSCX – gaining 106 points to close at 12,433.
Of the issues traded, 132 declined, 114 advanced and 27 remained unchanged on the CSE trading floor.
The port-city bourse traded 12.29 million shares and mutual fund units with turnover value of Tk 418 million.