Stocks extended the recovery mode for the second straight session on Thursday as bargain hunters favored taking positions in lucrative issues in anticipation of a potential turnaround.
Price hikes of sector specific stocks such as Beximco Pharma, Beacon Pharma, Pubali Bank, Sonali Paper and Mercantile Bank, pushed the market up. They jointly accounted for nearly 16-point rise of the key index.
The DSEX, the prime index of the Dhaka Stock Exchange (DSE), went up by more than 20 points to settle at 5,796. With that, the index recovered almost 58 points in the past two trading days.
Before that, substantial price erosion of large-cap stocks reduced the Dhaka bourse by more than Tk 1 trillion in value while the index shed 598 points since the withdrawal of floor price.
Market operators said stocks stayed positive on Thursday as pre-Eid sale pressure eased to some extent while bargain hunters opted to bet on beaten-down lucrative stocks.
Institutional buying support added strength to the equity indices despite overall market sentiment still remaining subdued.
Two other indices also closed in the positive note. The DSE 30 index, comprising blue chips, saw a fractional gain of 0.80 point to finish at 2,015 while the DSE Shariah index (DSES) advanced 9 points to 1,266.
"Buyers continued their dominance across the trading floor since opportunistic investors sought bargain hunting in sector-specific stocks," said EBL Securities, in its regular market analysis.
The stockbroker, however, said cautious investors preferred to stay on the sidelines until the market experienced a major trigger to regain a positive momentum.
The market has been suffering from a liquidity crisis for a long time amid the tightening of the money market.
The growing deposit rates in the banking sector and higher returns from Treasury bonds have been luring savers to the money market from the stock market.
Hence, daily turnover on Thursday remained as low as it had been for weeks. It slightly went up from the day before to Tk 4.37 billion.
Low-performing stocks dominated the market turnover chart. Malek Spinning Mills was the most-traded stock with a transaction volume of Tk 203 million, followed by Shinepukur Ceramic Tk 184 million, Alif Industries Tk 176 million, Central Pharma Tk 152 million, and Lovello Ice-cream Tk 145 million.
Investors showed immense interest in the textile sector as the sector grabbed 23 per cent of the day's total turnover, led by Malek Spinning Mills that captured 4.65 percent alone.
Among the major sectors, the textile sector also posted the highest gain of 3 per cent, followed by jute, paper & printing, non-bank financial institutions, pharma and power sectors.
On the other hand, ceramic saw the highest loss of 1 percent, followed by services, IT, engineering and banking sectors.
Gainers took a strong lead over losers. Out of 397 issues traded, 222 advanced, 113 declined and 62 issues remained unchanged on the DSE trading floor.
C&A Textile was the day's top gainer, rising 10 per cent, while Acme Pesticides was the worst loser, shedding 6.72 per cent, following its poor dividend declaration for 2023.
Acme Pesticides on Thursday declared only 0.20 per cent cash dividends for 2023, despite earning Tk 130 million in 2023.
The Chittagong Stock Exchange (CSE) also extended the gaining streak with the CSE All Share Price Index - CASPI -gaining 84 points to settle at 16,614 and the Selective Categories Index - CSCX rising 53 points to 9,993.
Of the issues traded, 97 declined, 65 advanced and 29 issues remained unchanged on the CSE.
The port city bourse traded 3.73 million shares and mutual fund units with a turnover volume of Tk 141 million.
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