Market stumbles amid profit-booking pressure

Stocks slipped back into the red this week after a huge jump the previous week, as risk-averse investors chose to lock in profits on quick-gaining shares.
The correction was due to profit taking on stocks that saw irrational price appreciation the previous week after the fall of Sheikh Hasina-led government, according to market experts.
As the previous week saw the key equity index surge 591 points, reaching a five-month high, cautious investors opted to book their profits this week. Of the five trading days this week, the market closed three sessions lower while two other sessions ended higher.
The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), finally settled the week 20.97 points or 0.35 per cent lower at 5,904.
"Stocks closed in red this week as investors opted to realise their recent gains amid uncertainty regarding the sustainability of the market's upbeat momentum," commented EBL Securities, in its weekly review.
Although the week opened on a positive note, driven by euphoria following the recent major political shift, the market appeared to cool down as investors eventually preferred profit taking, which compelled the market to end slightly lower, the stockbroker noted.
Most stocks had gone up by more than 20 per cent after the ouster of the former prime minister and cautious investors decided to take the profit. That, according to experts, was a positive thing because when investors make profits they get confidence to invest more.
"The market soared irrationally after the government fell due to over enthusiasm, so this profit booking tendency should be of no surprise," said Md Saiful Islam, president of the DSE Brokers Association of Bangladesh.
The blue-chip DS30 index, a group of 30 prominent companies, jumped more than 46 points to 2,179 as blue-chip stocks stayed afloat amid buying spree.
Major blue chip stocks such as Grameenphone, BRAC Bank, BAT Bangladesh, United Commercial Bank, Renata and Robi Axiata largely pushed the blue chip index higher.
They made a significant impact on the index as these six stocks jointly accounted for an 82-point rise in the key index, but failed to offset the losses due to price fall of most traded shares.
On the bright side, buyers remain active in the market, Mr Saiful Islam said, adding that investors regained their confidence, leading to a fresh influx of funds.
Being upbeat about the development of the country's political landscape, investors made fresh bets on large-cap and blue-chip stocks.
Total turnover of the week surged to Tk 64.11 billion, hitting a two-year high, as against Tk 33.40 billion in the previous week. And the average daily turnover stood at Tk 12.11 billion, up 65 per cent from the previous week's turnover of Tk 8.35 billion.
The banking sector dominated the turnover chart, capturing 24.4 per cent of the week's total turnover, followed by pharmaceuticals with 14.4 per cent and telecom 11 per cent.
Major sectors witnessed mixed performance. The telecom sector saw the highest gain of 18.6 per cent as the sector heavyweight GP surged 24 per cent alone. It was followed by food with 3.46 per cent gain, banking 0.98 per cent and cement 0.88 per cent.
On the other hand, the engineering sector suffered 3.4 per cent loss, followed by power with 2.6 per cent and pharma 1.3 per cent.
Losers took a strong lead over the gainers, as out of 398 issues traded, 278 closed lower, 105 ended higher and 15 remained unchanged on the Dhaka bourse.
Grameenphone became the most traded stock with shares worth Tk 4.97 billion changing hands, closely followed by BRAC Bank, Robi, Square Pharma, and IFIC bank.
Islamic Finance was the top gainer with a rise of 47.3 per cent, while GQ Ball Pen was the top loser, shedding 14 per cent.
The Chittagong Stock Exchange, however, stayed afloat with its All Shares Price Index (CASPI) rising 232 points to 17,031, while the Selective Categories Index (CSCX) rose 127 points to 10,259 points.

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