Stocks break two-week losing streak

Babul Barman | Published: May 27, 2017 00:00:00 | Updated: February 01, 2018 00:00:00

Stocks rebounded last week that ended Thursday, breaking a two-week losing streak, as investors showed their buying appetite on some large-cap issues amid optimism.
Market insiders said the government decision to cut yield rates of savings instruments coupled with lucrative price level of many fundamental issues, prompted investors to take fresh position anticipating short-term rally.
Finance Minister AMA Muhith last week said the interest rate of national savings certificates will be cut next month as the returns from those tools are very high compared to other rates prevailing in the market.
Business communities have been demanding a cut in the yield rate of savings instruments for a long as the high yield is diverting funds from banks as well as stock markets.
However, some investors remained followed cautious stance amid recent gloomy situation regarding the new value added tax (VAT) rate fixation, coupled with upcoming national budget and holy Ramadan," said an analyst at a leading brokerage firm.
Meanwhile, during the Ramadan, the trading on both bourses -- the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) will start at 10:00am and continue till 2:00pm.
The week witnessed five trading sessions as usual. Of them, first session faced correction while last four closed higher.
Week-on-week, DSEX, the prime index of the DSE, went up by 14.16 points or 0.26 per cent to settle at 5,414.
"Several factors including declaration on yield rate cut of national savings instruments and upcoming budget aspiration, helped to reinstate investors' confidence to take fresh position on sector specific stocks," commented EBL Securities, a stockbroker, in its weekly analysis.Â Â
The two other indices also closed higher. The DS30 index, comprising blue chips, soared 19.57 points or 0.98 per cent to close at 2011. The DSE Shariah Index also advanced 5.40 points or 0.43 per cent to close at 1,261.
The port city bourse, Chittagong Stock Exchange (CSE), also finished higher with its Selective Categories Index, CSCX, gaining 34.58 points or 0.34 per cent to settle at 10,159.
The total turnover for the week stood at Tk 26.99 billion, registering a decline of 9.0 per cent over the previous week's Tk 29.70 billion.
The daily turnover averaged at Tk 5.40 billion, which was 9.0 per cent lower than the previous week's average of Tk 5.94 billion.
Fuel and power sector emerged as the week's turnover leader, capturing 15 per cent of the week's total turnover value, followed by textile 14 per cent and engineering 13 per cent.
International Leasing Securities, a stockbroker, said, "The market backed to the green after a two-week break as the enthusiastic investors went for buying spree".
The stockbroker noted that the ongoing pessimism coupled with VAT rate reformation, kept most of the investor's in the side line.
"Participation of the investors on the issues from food, power and telecom stocks contributed to surge the prime index," said the stockbroker.
The losers took a modest lead over the gainers as out of 332 issues traded, 169 closed lower, 139 closed higher and 24 remained unchanged on the DSE trading floor.
The total market capitalisation of the DSE advanced 0.46 per cent last week as it was Tk 3,691 billion on the opening day of the week, while it came down to Tk 3,675 billion on closing day of the week.
One multinational listed company - Berger Paints Bangladesh -- recommended 425 per cent final cash dividend for the 15 months period from January 01, 2016 to March 31, 2017 last week.
The company declared total 600 per cent cash dividend for the 15 months period as the company already disbursed 175 per cent interim cash divined.
IFAD Autos topped the week's turnover chart with about 12.25 million shares of Tk 1.66 billion changing hands, closely followed by United Power Tk 999 million, Paramount Textile Tk 832 million, Bangladesh Shipping Corporation Tk 798 million and Doreen Power Tk 792 million.
The Peninsula Chittagong was the week's highest gainer, posting a 14.66 per cent rise, while Rupali Insurance Company was the worst loser, shedding by 13.71 per cent.
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