FE Report
Turnover on the Dhaka Stock Exchange (DSE) dipped to Tk 2.74 billion on Thursday -- the lowest in 20 months -- as most investors stayed on the sidelines amid persistent liquidity crisis.
The day's turnover, a crucial indicator of the market, slumped by 32 per cent, compared with the previous day's transactions of Tk 4.05 billion.
It is the lowest single-day transactions since July 11, 2016, when the turnover was recorded at Tk 2.72 billion.
Market operators said small investors refrained from making fresh investments while the institutional investors could not support the market more due to liquidity crisis, brining the turnover to 20-month low.
"The ongoing liquidity shortage in the banking sector pushed banks' deposit interest rate high in recent weeks and lured many investors to put money in banks instead of investing in the capital market, which was taking a toll on the market turnover," said an analyst at a leading brokerage firm, wishing not to be named.
He noted that ambiguity over the Dhaka bourse's share sales to strategic partner and concerns over the ongoing liquidity crunch contributed to the low turnover.
The market, however, ended marginally higher with the DSEX -- the core index of the DSE -- advancing 5.80 points to settle at 5,828.
"Investors remain very cautious and the uncertainty over the Dhaka bourse's share sales to strategic partner continues," commented City Bank Capital Resources in an analysis.
The merchant bank noted that the turnover hit the lowest level in more than 20 months, as investors were mostly inactive amid the persistent liquidity shortage.
According to International Leasing Securities, the market started with profit-booking sell-off and remained in negative territory until the investors went on a buying spree for bank sector stocks in the last hour, which helped the prime index to close in green.
The DS30 index, comprising blue chips, also saw a fractional gain of 0.19 point to finish at 2,144. However, the DSE Shariah Index (DSES) lost 0.26 points or 0.02 per cent to close at 1,373.
"Turnover in the market hit rock bottom as market turnover scored the lowest in the last 20 months, reaching Tk 2.74 billion," commented EBL Securities, a stockbroker, in an analysis.
However, investors' buying pressure was spotted in stocks from banks, financial institutions and food and allied sectors, the stockbroker said.
Large-cap sectors showed mixed performance, with banking sector posted the highest gain of 0.62 per cent after two sessions of correction, followed by non-bank financial institutions (0.19 per cent), food & allied (0.16 per cent) and telecommunications (0.04 per cent).
Engineering sector witnessed the biggest loss of 0.60 per cent, followed by pharmaceuticals (0.24 per cent) and fuel & power (0.15 per cent).
Losers took a modest lead over the gainers, as prices of 162 securities, out of 334, declined, 120 advanced and 52 remained unchanged on the DSE floor.
Al-Arafah Islami Bank dominated the day's turnover chart, with shares worth over Tk 124 million changing hands, closely followed by Monno Ceramic Industries, Square Pharmaceuticals, ACI and Grameenphone.
Summit Alliance Port was the day's best performer, posting a gain of 4.23 per cent while Asia Pacific Insurance was the day's biggest loser, shedding 4.93 per cent.
The port city bourse, Chittagong Stock Exchange (CSE), also edged up with the CSE All Share Price Index - CASPI - advancing 7.75 points to settle at 18,000 and selective Categories Index -- CSCX --gaining 4.58 points to finish at 10,867 points.
Here too, the losers beat the gainers, as 100 issues closed higher, 79 lower and 36 remained unchanged.
The port city bourse traded 4.41 million shares and mutual fund units worth over Tk 243 million in turnover.
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