FE Today Logo

Heavyweights drag DSEX down to two-month low

Equity turnover soars 12 per cent

FE REPORT | October 25, 2021 00:00:00

Stocks plunged on Sunday, after a single-day break, with the benchmark index of Dhaka Stock Exchange (DSEX) holding close to a two-month low, as jittery investors dumped their shares to avoid further losses.

Although the market opened on an upbeat note and the core index soared 62 points within the first hour of trading, the remaining hours of the session saw the index go down steadily amid panic sell-offs on large-cap stocks.

The benchmark DSEX index dropped 70.52 points or 0.99 per cent to settle at 7,005, after gaining more than 55 points the previous day.

Market analysts said investors became nervous at the continuous fall of the index seen in the past week, so they sold off shares. In the last nine consecutive days, eight sessions suffered losses, with the index shedding a total of 362 points.

The market index kept falling despite the announcement of hefty dividends by two pharma giants and some large-cap companies, said a merchant banker.

The share price of Square Pharmaceuticals, the largest drug maker, which declared a hefty 60 per cent cash dividends, fell by 3.25 per cent. Beximco Pharma declared a record 35 per cent cash dividends, yet the share price of the company plunged by 1.48 per cent.

Besides, some large-cap companies -- Grameenphone, Square Pharma, Robi, Walton, LafargeHolcim, BATBC and Investment Corporation of Bangladesh -- went down significantly, creating a panic among small investors, he said.

However, some investors purchased shares of Beximco, United Power, BSRM and Orion Pharma, buoyed by their higher profit growth, but failed to prevent the market fall, he added.

Two other DSE indices also ended lower. The DS30 index, comprising blue chips, dropped 1.02 points to finish at 2,698 and the DSE Shariah Index (DSES) fell sharply by 30.37 points to close at 1,487.

Turnover, another important indicator of the market, stood at Tk 14.71 billion on the country's premier bourse, which was 12 per cent higher than the previous day's tally of Tk 13.10 billion.

According to EBL Securities, the market nosedived after a single-day break, as the investors started to trim early losses and engaged in sell-offs amidst day-long volatility in the market.

Some investors continued their portfolio restructuring based on ongoing year-end earnings and dividend declarations quarter-end corporate disclosures, said the stockbroker.

Of the major sectors that suffered losses, cement saw the highest correction of 3.0 per cent, followed by financial institutions (1.70 per cent), telecoms (1.50 per cent), pharma (1.50 per cent), engineering (1.10 per cent) and food (0.90 per cent).

Only the miscellaneous sector gained 3.80 per cent riding on sector heavyweight Beximco which gained 7.50 per cent alone.

Losers took a strong lead over the gainers, as out of 375 issues traded, 292 closed lower, 57 higher and 26 remained unchanged on the DSE trading floor.

Beximco -- the flagship company of Beximco Group -- topped the turnover chart with shares worth Tk 3.42 billion changing hands, grabbing 23 per cent of the day's total turnover. It was followed by Orion Pharma (Tk 793 million), Delta Life Insurance (Tk 784 million), NRB Commercial Bank (Tk 728 million) and Genex Infosys (Tk 617 million).

Beximco was also the top gainer, posting a 7.50 per cent gain following the news of its record dividend and profit growth while FAS Finance was the worst loser, shedding 10.66 per cent.

The Chittagong Stock Exchange (CSE) also ended lower with the CSE All Share Price Index (CASPI) plunging by 122 points to settle at 20,570 and the Selective Categories Index (CSCX) shedding 72 points to close at 12,361.

Of the issues traded, 205 declined, 62 advanced and 21 remained unchanged on the CSE trading floor.

The port city's bourse traded 12.87 million shares and mutual fund units with turnover value of nearly Tk 500 million.

[email protected]

Share if you like