weekly stock market review

FE Report The Dhaka Stock Exchange (DSE) could not come out of its losing streak and downtrend continued for the fourth straight week, despite repeated assurances from the banks, the market regulator and different stakeholders, as most of the assurances remained unimplemented. Insiders said all positive steps to rejuvenate the capital market and boost the investors' confidence failed to create expected impact on the market. Rather, the falling trend is continuing, disappointing most of the investors. "The market went to negative for consecutive weeks, as all of the back to back market-bolstering regulatory and monetary initiatives apparently failed to revive the investors' confidence and bring back stability in the market," commented a stock broker. In the last week, optimism grew among the traders following the latest move of the Association of Bankers, Bangladesh (ABB), as they decided to increase their stock market investment, but their promises are yet to come into light. The Bangladesh Association of Banks (BAB) also unveiled an ambitious plan to launch a Tk 50 billion market stabilisation fund, to be operated by an independent asset management company. The announcements came after weeks of discussions, as the ministers, regulators and stock brokers were seeking a way out amid the small investors' protest that continued for the past few weeks. However, the promises made by the ABB and the BAB on injecting a substantial amount of fresh fund to the stock market have raised many critical questions about its real motive. The World Bank (WB) and the International Monetary Fund (IMF) said the banks would face difficulty, if they go for further investment in stock market. The WB also expressed its concern about formation of the special fund to salvage the plunging market, saying it would raise the banks' liabilities, while the IMF raised question about the formation of the stock market stabilisation fund. All these contributed significantly to shake the small investors' confidence further. As a result, they took to the streets in the last two days of the week, protesting free fall of share prices and demanding normalcy in the capital market. The week witnessed five trading sessions as usual. Among them, two sessions gained, while three sessions lost. During the week, the DGEN, the DSE's benchmark index, went down by 235.97 points or 4.26 per cent to close at 5,308.79. The broader All Shares Price Index (DSI) shed 205.88 points or 4.43 per cent to close at 4,439.20. The DSE-20 Index comprising blue-chip shares plummeted 74.70 points or 1.89 per cent to close at 3,874.09. However, the total turnover value stood at Tk 20.7 billion compared to Tk 13.8 billion in the previous week. This was the highest weekly turnover value among three weeks. The average daily turnover rose by 50.7 per cent in the week and stood at Tk 4.1 billion, compared to Tk 2.8 billion in the previous week. Out of the 266 issues traded during the week, only 21 advanced, 243 declined, while two remained unchanged. The market capitalisation was Tk 2,698.57 billion on the opening day of the week, and at the end of the week it stood at Tk 2,629.52 billion, 2.56 per cent lower. All the sectors, except telecommunications, lost in the week. Grameenphone (GP), the lone listed company in the telecommunication sector, advanced 12.7 per cent, following its impressive Q3 earnings report. Banks lost only 1.14 per cent in the week, while NBFIs lost 7.77 per cent, general insurance lost 6.11 per cent, and life insurance lost 6.27 per cent. Mutual funds, pharmaceuticals, fuel and power, and cement sectors declined by 5.67 per cent, 4.58 per cent, 5.60 per cent and 10.03 per cent respectively in the week. GP also topped the week's turnover list with shares worth Tk 1.07 billion changing hands. The other turnover leaders were Beximco Limited, SIBL, National Bank, UCBL, Titas Gas, ONE bank, MI Cement, City Bank and Beximco Pharma. GP was the week's highest gainer, posting a rise of 12.66 per cent. It was followed by City Bank, Fifth ICB, Jamuna Bank, Bank Asia, Fourth ICB, Standard Insurance, Samorita Hospital, ACI Zero Coupon Bonds and Dhaka Bank. The week's worst losers included Imam Button, Alltex Industries, Libra Infusions, Meghna Cement, BD Autocars, Anlima Yarn, Delta Life Insurance, Federal Insurance, HR Textile and Rahima Food. Twenty companies made corporate declarations during the week. The companies are - Usmania Glass, Imam Button, Quasem Drycells, MI Cement, Dacca Dyeing, Agni System Limited, Rahim Textile, AMCL (Pran), Desh Garment, Eastern Housing, BATBC, Jute Spinners, Alltex Industries, Atlas Bangladesh, Titas Gas, Libra Infusion, Fu-Wang Ceramics, Metro Spinning and Prime Textile. On Sunday, the market closed 109.49 points or 1.97 per cent higher with the turnover hitting the nearly three-month-high of Tk 6.16 billion, as the investors went for fresh buying, riding on the news of the moves by the ABB and the BAB. On Monday, the market again witnessed a sharp decline after two sessions of gain with low turnover, as the latest move of the private commercial banks apparently failed to revive the investors' confidence and bring back stability in the market. The key index of the DSE plummeted 180.62 points or 3.19 per cent to close at 5,473.61, while the turnover value declined to Tk 4.19 billion against Tk 6.16 billion in the previous session. On Tuesday, the market returned to gaining streak again amid volatile trading, though the turnover declined further, as participation of the institutional investors remained low. The DGEN rose 81.66 points or 1.49 per cent, while the turnover value declined significantly to Tk 3.50 billion. On Wednesday, the DGEN lost 143.29 points or 2.57 per cent amid street protest, as most of the investors sold off their shares in panic despite repeated assurances of different stakeholders, while the turnover stood at Tk 3.43 billion. On Thursday, the key index plummeted another 103.20 points or 1.90 per cent to close at 5,308.78, triggering demonstration by the frustrated investors again in front of the DSE. The turnover value stood at Tk 3.44 billion against Tk 3.43 billion in the previous session, suggesting that the institutions were not fully active in the market.