Stocks keep gaining amid growing optimism

Stocks posted a modest gain in the outgoing week, extending the winning streak for five consecutive weeks, as optimistic investors continued buying shares on the expectation of improving economic activities.
Market operators said gradual reopening of the economy and the stock market regulator's assurance not to lift floor price restriction until the market got stable, led investors for buying shares at possible lowest prices.
The securities regulator Chairman Prof. Shibli Rubayat-Ul-Islam assured last week that the floor price ceiling would not be lifted until the market becomes stable that played a role in the market gain.
The stock market regulator imposed the floor price restriction on March 19 to curb free fall in stock prices amid the Covid-19 outbreak.
The BSEC chairman's assurance came as there was a rumour on the market that the restriction would be withdrawn soon as some institutional investors demanded so.
The week featured five trading sessions as usual. Of them, the three sessions gained while two sessions faced profit booking sell-pressure.
Week-on-week, DSEX, the key index of the Dhaka Stock Exchange, went up by 11.83 points or 0.29 per cent to settle the week at 4,080.
The DSE core index added a cumulative around 120 points or 3.0 per cent in the past five consecutive weeks.
Two other indices also nudged higher. The DS30 index, comprising blue chips, gained 5.83 points to close at 1,374 and the DSE Shariah Index saw a fractional gain of 0.61 point to settle at 946.
With the existence of floor price limitation and gradual reopening of the economy, investors' showed approach in taking positions, commented UCB Capital Management in its weekly market analysis.
The securities regulator's ultimatum to non-compliant directors of listed firms to ensure holding of minimum 2.0 per cent shares within 45 days spurred the buy pressure in the market, said a leading broker.
The securities regulator has recently asked 61 directors of 22 listed companies to ensure a minimum 2.0 per cent shares in their own companies within 45 days to continue their directorship.
However, the market has been struggling with a poor participation of investors for long due to the regulator- enforced floor price restriction and no signs of improving the ongoing Covid-19 situation.
The total turnover, a crucial indicator of the market, came down to Tk 12.37 billion as against the previous week's total turnover of Tk 15.08 billion.
The daily turnover averaged Tk 2.47 billion, which was 18 per cent lower than the previous week's average of Tk 3.01 billion.
Block trade contributed 16.3 per cent to the total weekly turnover, where stocks like Islami Bank (Tk 497.4 million), Khulna Power Company (Tk 403.2 million), Eastern Bank (Tk 305.2 million) and ACI (Tk 198.2 million) dominated the block trade board.
Among the major sectors, telecommunication posted the highest gain of 3.47 per cent, followed by IT with 3.30 per cent, textile 1.36 per cent, power 1.10 per cent, engineering 0.45 per cent, food 0.41 per cent and pharma 0.03 per cent.
On the other hands, banking and cement sectors lost 0.18 per cent and 0.10 per cent respectively.
Most of the shares, however, remained stuck at the trading floor. Of the traded issues, 169 remained unchanged while 136 issues advanced and 52 declined on the DSE.
The market capitalisation of the DSE rose to Tk 3,175 billion Thursday, from Tk 3,154 billion in the previous week.
Grameenphone dominated the week's turnover chart with shares worth Tk 533 million changing hands, followed by Square Pharma, Beximco Pharma, Pioneer Insurance and Nahee Aluminum.
Dhaka Insurance was the week's best performer, posting 30 per cent while Islami Bank was the week's worst loser, losing 12.12 per cent following its price adjustment after record date.
The Chittagong Stock Exchange (CSE) also edged higher with its CSE All Share Price Index - CASPI -gaining 63 points to settle at 11,622 and the Selective Categories Index - CSCX rising 37 points to close at 7044.
Of the issues traded, 89 gained, 46 declined and 147 remained unchanged on the CSE.
The port city's bourse traded 12.08 million shares and mutual fund units with turnover value of Tk 301 million.

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