The market ended flat in the week ended Thursday last amid high volatility as higher capital gain tax imposition in the proposed budget disappointed the investors most.
The week featured all five trading sessions. Among them, the market suffered loss in three sessions while two sessions closed in positive.
Week-on-week, DSEX, the prime index of Dhaka Stock Exchange (DSE) went up by 12.26 points or 0.28 per cent to close at 4,408.80 points.
The other two indices also closed positive. The DS30, comprising blue chips, gained 15.13 points or 0.93 per cent to close at 1,638.08 points. The DSE Shariah Index (DSES) went up by 10.41 points or 1.03 per cent to close at 1,018.24 points.
The port city bourse, the Chittagong Stock Exchange (CSE) also inched up last week with its Selective Categories Index (CSCX) gained 76.36 points or 0.92 per cent to close the week at 8,410.43 points.
The total turnover of the week amounted to Tk 20.95 billion on DSE which was Tk 20.29 billion in the previous week.
The average daily turnover for the week stood at Tk 4.19 billion, registering an increase of 3.26 per cent over the previous week's average of Tk 4.06 billion.
"Proposed national budget for the fiscal year 2014-15, expectational mismatch and their consequential impact sustained throughout the week," IDLC Investments, said in its weekly market analysis
Higher capital gain tax imposition disappointed the investors most, psychologically, said the merchant bank.
Resultantly, cyclicality prompted and changed the mode of investments. The investors swapped across cap segments, looking for lucrative hunt, said the merchant bank.
The investors also started changing preference across sectors and stocks. Some large caps shuffled their phases, especially Lafarge Surma Cement's interim dividend disclosure concentrated investors mostly on it to be in a selling mood, the merchant bank said.
They started focusing on telecommunications, especially GP, entering in a gaining streak throughout the week and GP gained 4.69 per cent alone, it said.
Besides, back and forth trading, merging with market movements instigated investors mostly in profit booking from certain inflated issues rather than positioning, the merchant bank added.
Lankabangla Securities, in its weekly market analysis, said, "Budget proposal of FY'15 cannot be said capital market friendly. Investors did not perceive the inauguration of capital gain tax at the individual level favorable for them".
Timing of introduction of such tax is not appropriate, as market sentiment is very shaky now. Withdrawal of the provision for 10 per cent tax rebate for companies declaring more than 20 per cent dividend is also very discouraging, said the stock broker.
"It will increase effective tax rate for companies that used to pay more than 20 per cent dividend. Companies that give more than 20 per cent dividend had an effective tax rate of 24.75 per cent after rebate of 10 per cent".
There was no specific motivation for stock market while tax for non-listed companies was reduced, said the stock broker
The losers and gainers of the week was almost same as out of 302 issues traded during the week, 147 advanced, 148 declined and four issues remained unchanged on the DSE floor.
All the major sectors ended positive except food and allied and banks which retraced 2.32 per cent and 1.18 per cent respectively.
Telecommunications posted the highest gain of 4.59 per cent in the week which was largely attributed to the recent rally of GP. GP gained 4.69 per cent alone. NBFIs followed next gaining 2.14 per cent. Pharmaceuticals and fuel and power advanced 1.24 per cent and 1.04 per cent respectively.
Two listed companies - Lafarge Surma Cement and Asia insurance made corporate declaration during the week. Lafarge Surma Cement declared 5.0 per cent interim cash dividend while Asia Insurance recommended 15 per cent cash and 5.0 per cent stock dividend.
The market capitalisation of the DSE went up marginally by 0.49 per cent as it was Tk 2,895.09 billion on the opening day of the week and it stood at Tk 2,909.23 billion on closing session of the week.
