Stocks edge up as small-caps dominate

Stocks posted a moderate gain in the outgoing week, snapping a single-week break, as bargain hunters renewed their buying appetite for rumor-based stocks in anticipation of quick gain.
This week featured five trading days. Of them, four sessions posted gains while one suffered losses, with investors mostly focused on small-cap stocks.
Small-caps are still favourites among a section of investors even though these securities are believed to be manipulated.
Small-cap stocks such as Fu-Wang Food, Central Pharma, Western Marine Shipyard, Fu-Wang Ceramic and Yeakin Polymer were on the list of the top weekly advancers.
These companies are not able to pay dividends regularly due to losses and they are struggling to keep production running, but their stocks price soaring based on the speculation.
The market movement was led by these particular small-cap stocks as they sought to take positions in the quick rallies in anticipation of quick gains, said a leading broker.
"Investors are turning to small-caps in the past few weeks instead of fundamentals in hopes of higher returns from lower investments," he said.
These stocks have, however, insignificant impact on the market index. As a result, DSEX, the prime index of the Dhaka Stock Exchange (DSE), went up only 6.31 points to settle at 6,341.10, after losing more than 9 points in the week before.
The DS30 Index, which consists of blue-chip companies, also gained 5.56 points to close at 2,197 and the DSES index, which represents Shariah-based companies, rose 4.26 points to 1,379.
Market operators said stocks managed to close in the green as some investors opted to seize quick gain opportunities in sector-specific shares that recently faced sharp corrections.
Also, investors showed buying interest in those stocks that recently broke out from the floor price.
"Despite the sell pressure from cautious investors during the week, the buyers expanded the upper hand, with participation focused mostly on the rumor-based junk stock," according to EBL Securities.
Turnover, the crucial indicator of the market, soared to Tk 42.57 billion in total, up from Tk 35.86 billion in the week before.
The average daily turnover stood at Tk 8.51 billion in the outgoing week as against Tk 7.17 billion in the previous week.
Investors were mostly active in the food sector, capturing 17 per cent of the week's total turnover, followed by textile with 12 per cent and life insurance 11 per cent.
However, the majority of the traded issues remained stuck at floor price as 391 issues traded, 194 issues remained unchanged, 70 advanced and 23 closed in the red.
Life insurance sector took a big hit, losing 2.80 per cent as nine out of top 10 losers were life insures while jute, travel & leisure, ceramic and cement sectors posted moderate gain.
Fu-Wang Food kept its dominance in the weekly turnover charts with shares worth Tk 3.25 billion changing hands. Its stock price also jumped 34.06 per cent during the week, becoming the week's top gainer.
The Chittagong Stock Exchange (CSE) also edged up, with the CSE All Share Price Index (CASPI) gaining 11 points to settle at 18,731 and the Selective Categories Index (CSCX) rising 1 point to close at 11,188.
Of the issues traded, 95 declined, 70 advanced and 149 issues remained unchanged on the CSE.
The port city's bourse traded 36.85 million shares and mutual fund units with turnover value worth Tk 861 million

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