Investors yet to shake off effect of SEC decisions
Sunday, 9 December 2007
FE Report
The stock market passed yet another dull week (December 2-6) amid a thin turnover.
Market operators said the market is bearing the brunt of recent actions taken by the Securities and Exchange Commission (SEC) which affected the investors' confidence.
The SEC in a directive on November 19 banned the loan disbursement by merchant banks and brokerage houses which prompted serious erosion in stock prices.
The stock market witnessed rowdy demonstration because of the SEC decision Monday last and later the regulatory body withdrew the directive.
"Such actions of SEC is not market-friendly and we are facing the consequences," a DSE source said.
The market operators also opined that the SEC could control the 'overheated market' through using other tools, but not withdrawing the total loan margin facility.
All the market barometers-DSE General Index (DGEN), DSE 20 and all share price index (DSI) shed 40.43 points, 29.98 points and 35.34 points respectively to close at 2930.68, 2302.50 and 2475.98 points.
The daily average turnover dipped 16.78 per cent at Tk 1.38 billion in the week against Tk 1.66 billion.
The total market capitalization also declined by 1.17 per cent to Tk 727.54 billion.
The market capitalization now hovers over $ 10 billion.
Out of 281 listed issues, only 91 gained, 149 declined, 8 remained unchanged and 33 were not traded.
BRAC Bank and United Commercial Bank (UCB) were the top turnover leaders with transactions worth Tk 536.19 million and 478.44 million respectively, accounting for 7.75 per cent and 6.91 per cent of the week's total turnover.
Power Grid, IBBL Bond, Summit Power, Uttara Bank, BOC Bangladesh, Trust Bank, Square Pharma and Lankabangla Finance were the other turnover leaders.
All but one Z-category issues were the top ten gainers in the week.
Z-category issues-Mita Textile, Fine Foods, Bd Thai Aluminium, Bengal Biscuit, Gachihata, Excelsior Shoes, German Bangla Foods, Raspit and Tripti- were the other top gainers.
"A recent move of the SEC on recasting the board of directors of the Z-category companies by including independent members from the general shareholders attracted the buyers to buy Z-category issues," a market operator pointed out.
The source further pointed out that non-existence of circuit breaker on the Z-category issues are also causing the abrupt rise or fall of the issues.
B-category issue-Kay and Que was the top gainer with a whopping 49.66 per cent rise in the week.
"We did not see any price sensitive disclosure from the Kay and Que but the issue price whopped because of huge trading by a section of traders," a DSE source said.
On the other hand, Dulamia Cotton, Metalex Corporation and Eastern Lubricant were the top losers with 14.29 per cent, 12.07 per cent and 11.54 per cent decline respectively.
Mithun Knitting, Aziz Pipes, Jute Spinners, Tamijuddin Textile, Keya Detergent, Bangladesh Shipping Corporation and Usmania Glass were the other top losers in the week.
The stock market passed yet another dull week (December 2-6) amid a thin turnover.
Market operators said the market is bearing the brunt of recent actions taken by the Securities and Exchange Commission (SEC) which affected the investors' confidence.
The SEC in a directive on November 19 banned the loan disbursement by merchant banks and brokerage houses which prompted serious erosion in stock prices.
The stock market witnessed rowdy demonstration because of the SEC decision Monday last and later the regulatory body withdrew the directive.
"Such actions of SEC is not market-friendly and we are facing the consequences," a DSE source said.
The market operators also opined that the SEC could control the 'overheated market' through using other tools, but not withdrawing the total loan margin facility.
All the market barometers-DSE General Index (DGEN), DSE 20 and all share price index (DSI) shed 40.43 points, 29.98 points and 35.34 points respectively to close at 2930.68, 2302.50 and 2475.98 points.
The daily average turnover dipped 16.78 per cent at Tk 1.38 billion in the week against Tk 1.66 billion.
The total market capitalization also declined by 1.17 per cent to Tk 727.54 billion.
The market capitalization now hovers over $ 10 billion.
Out of 281 listed issues, only 91 gained, 149 declined, 8 remained unchanged and 33 were not traded.
BRAC Bank and United Commercial Bank (UCB) were the top turnover leaders with transactions worth Tk 536.19 million and 478.44 million respectively, accounting for 7.75 per cent and 6.91 per cent of the week's total turnover.
Power Grid, IBBL Bond, Summit Power, Uttara Bank, BOC Bangladesh, Trust Bank, Square Pharma and Lankabangla Finance were the other turnover leaders.
All but one Z-category issues were the top ten gainers in the week.
Z-category issues-Mita Textile, Fine Foods, Bd Thai Aluminium, Bengal Biscuit, Gachihata, Excelsior Shoes, German Bangla Foods, Raspit and Tripti- were the other top gainers.
"A recent move of the SEC on recasting the board of directors of the Z-category companies by including independent members from the general shareholders attracted the buyers to buy Z-category issues," a market operator pointed out.
The source further pointed out that non-existence of circuit breaker on the Z-category issues are also causing the abrupt rise or fall of the issues.
B-category issue-Kay and Que was the top gainer with a whopping 49.66 per cent rise in the week.
"We did not see any price sensitive disclosure from the Kay and Que but the issue price whopped because of huge trading by a section of traders," a DSE source said.
On the other hand, Dulamia Cotton, Metalex Corporation and Eastern Lubricant were the top losers with 14.29 per cent, 12.07 per cent and 11.54 per cent decline respectively.
Mithun Knitting, Aziz Pipes, Jute Spinners, Tamijuddin Textile, Keya Detergent, Bangladesh Shipping Corporation and Usmania Glass were the other top losers in the week.