Profit-takers put brakes on DSE's record rally
Friday, 14 May 2010
FE Report
Dhaka stocks swung into the red Thursday as profit-taking snapped two-days of record breaking bull runs that saw the market gain nearly five per cent in one of the best performances by the bourse this year.
A sell-off of the banking shares - the bellwether of the market - pulled the indices down despite gains by some smaller sectors including mutual funds, pharmaceuticals, fuel and power and engineering.
The benchmark DSE General Index (DGEN) shed 64.38 points or 1.10 per cent to close at 5747.35 from its second best of 5811.73 recorded in the previous day.
The broader All Shares Price Index (DSI) ended at 4728.76, down 49.99 points or 1.04 per cent. The DSE 20 index comprising the market's blue chip shares lost 29.37 points or 0.91 per cent to 3164.42.
The market gained 251 points or nearly five per cent in the last two days triggered by a major government decision that allowed the companies to convert the face value of their shares to Tk 10 each.
The approval has benefited more than two million retail investors, enabling them to buy shares that were previously too costly to afford - although the move hardly brings any fundamental changes into the companies balance sheets.
"The market was hit by a bout of profit taking after sharp gains on Tuesday and Monday," said Abdul Awal, managing director of Multi Securities and Services Limited.
"Especially, profit taking in the banking sector weighed heavily on the market," he said.
Shares valued at Tk 18.40 billion were traded, falling 18.55 per cent from the previous day's all time high of Tk 22.85 billion. The amount is still the third biggest turnover in the stock market's history.
Out of 238 issues traded, 111 closed positive, 122 negative and five remained unchanged.
Banking issues, which make up one-fourth of the bourse's market capitalisation-- declined 3.48 per cent after gaining more than ten per cent in the last three days.
EXIM Bank was the day's top loser plunging 13.21 per cent on lower-than-expected earnings in the first quarter. The bank posted a net profit of Tk 42.24 million in the first quarter, down 63 per cent from Tk 115.56 million a year earlier.
Telecommunications sector - one fifth of market capitalisation- broke its winning run in the last two straight sessions as Grameenphone, the lone listed company in the sector, fell 2.20 per cent to Tk 284.60.
Leasing or non-banking financial institutions sector dropped 0.83 per cent as the sector heavyweights, Industrial Promotion and Development Corporation (IPDC) and Prime Finance, declined 10.17 per cent and 1.72 per cent respectively.
Mutual funds, pharmaceuticals, engineering and fuel and power and some smaller companies ended positive.
Mutual funds advanced heavily for the second straight session; gaining 3.26 per cent a day after they rose four per cent.
Beximco Ltd topped turnover list with shares worth Tk 1.68 billion changing hands. Titas Gas was a close second with trading of Tk 1.50 billion shares.
They were followed by EXIM Bank, AB Bank, One Bank, LankaBangla Finance, Premier Bank, Summit Power, Southeast Bank and Shahjalal Bank.
Major losers included Alpha Tobacco, National Housing and Finance Investment Limited, Eastern Bank, Premier Bank, Standard Bank, Mercantile Bank and Sonargaon Textile.
Federal Insurance, Jamuna Oil, Grameen Scheme Two Mutual Fund, Agni System, BD Thai Aluminum, Navana CNG, Berger Paintings Bangladesh and Renata were the main gainers.
Dhaka stocks swung into the red Thursday as profit-taking snapped two-days of record breaking bull runs that saw the market gain nearly five per cent in one of the best performances by the bourse this year.
A sell-off of the banking shares - the bellwether of the market - pulled the indices down despite gains by some smaller sectors including mutual funds, pharmaceuticals, fuel and power and engineering.
The benchmark DSE General Index (DGEN) shed 64.38 points or 1.10 per cent to close at 5747.35 from its second best of 5811.73 recorded in the previous day.
The broader All Shares Price Index (DSI) ended at 4728.76, down 49.99 points or 1.04 per cent. The DSE 20 index comprising the market's blue chip shares lost 29.37 points or 0.91 per cent to 3164.42.
The market gained 251 points or nearly five per cent in the last two days triggered by a major government decision that allowed the companies to convert the face value of their shares to Tk 10 each.
The approval has benefited more than two million retail investors, enabling them to buy shares that were previously too costly to afford - although the move hardly brings any fundamental changes into the companies balance sheets.
"The market was hit by a bout of profit taking after sharp gains on Tuesday and Monday," said Abdul Awal, managing director of Multi Securities and Services Limited.
"Especially, profit taking in the banking sector weighed heavily on the market," he said.
Shares valued at Tk 18.40 billion were traded, falling 18.55 per cent from the previous day's all time high of Tk 22.85 billion. The amount is still the third biggest turnover in the stock market's history.
Out of 238 issues traded, 111 closed positive, 122 negative and five remained unchanged.
Banking issues, which make up one-fourth of the bourse's market capitalisation-- declined 3.48 per cent after gaining more than ten per cent in the last three days.
EXIM Bank was the day's top loser plunging 13.21 per cent on lower-than-expected earnings in the first quarter. The bank posted a net profit of Tk 42.24 million in the first quarter, down 63 per cent from Tk 115.56 million a year earlier.
Telecommunications sector - one fifth of market capitalisation- broke its winning run in the last two straight sessions as Grameenphone, the lone listed company in the sector, fell 2.20 per cent to Tk 284.60.
Leasing or non-banking financial institutions sector dropped 0.83 per cent as the sector heavyweights, Industrial Promotion and Development Corporation (IPDC) and Prime Finance, declined 10.17 per cent and 1.72 per cent respectively.
Mutual funds, pharmaceuticals, engineering and fuel and power and some smaller companies ended positive.
Mutual funds advanced heavily for the second straight session; gaining 3.26 per cent a day after they rose four per cent.
Beximco Ltd topped turnover list with shares worth Tk 1.68 billion changing hands. Titas Gas was a close second with trading of Tk 1.50 billion shares.
They were followed by EXIM Bank, AB Bank, One Bank, LankaBangla Finance, Premier Bank, Summit Power, Southeast Bank and Shahjalal Bank.
Major losers included Alpha Tobacco, National Housing and Finance Investment Limited, Eastern Bank, Premier Bank, Standard Bank, Mercantile Bank and Sonargaon Textile.
Federal Insurance, Jamuna Oil, Grameen Scheme Two Mutual Fund, Agni System, BD Thai Aluminum, Navana CNG, Berger Paintings Bangladesh and Renata were the main gainers.