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Stocks keep gaining on regulatory moves

Turnover exceeds Tk 8.0b-mark after three-week

FE REPORT | July 27, 2022 00:00:00

Stocks extended the gaining streak for the second straight session Tuesday as the bargain hunters put money cautiously on lucrative issues riding on regulatory interventions.

The market saw a steep rise at opening and the key index jumped over 100 points within the first hour of trading, but failed to maintain as investors perceived it a profit-booking opportunity, eventually ending more than 29 points higher.

DSEX, the key index of the Dhaka Stock Exchange (DSE), went up by 29.35 points or 0.48 per cent to settle at 6,112.

The prime index recovered about 60 points in the past two trading days after losing 315 points in the previous nine days after Eid vacation.

Turnover, the crucial indicator of the market, jumped to three-week high to Tk 8.38 billion on the country's premier bourse, rising 31 per cent over previous day's tally of Tk 6.40 billion.

Market analysts said the market kept gaining for the second running days thanks to the buying tendency among institutional investors.

Institutional investors, including the state-run Investment Corporation of Bangladesh, were active and put money on lucrative issues, taking the turnover and index higher, said a merchant banker.

"Regulatory interventions coupled with some positive news around the market encouraged the investors to put fresh funds on lucrative issues," he said.

The bargain hunters put fresh bets on sector-wise issues as they find some stocks at lucrative prices, said International Leasing Securities.

The institutional investors along with the high-net-worth individual investors increased their participation in the market after holding a meeting with the securities regulator Monday, said the stockbroker.

The positive expectations from the regulatory meeting regarding the banks' exposure in the stock market kept the market investors afloat, said EBL Securities.

However, the current macroeconomic headwinds still influenced many cautious investors to exit their positions, which ultimately curbed the upward price rally in the market at the end of the trading session, said the stockbroker.

Meanwhile, the Bangladesh Securities and Exchange Commission (BSEC) is trying to boost investors' confidence and increase the fund flow in the market.

The regulator will gradually sit with merchant bankers, stock brokers, banks, and listed companies to encourage them to play a proactive role in revamping the market.

The investors' activities were mostly focused on the textile sector, capturing 23 per cent of the day's total turnover, followed by miscellaneous (14 per cent) and pharmaceuticals (9.0 per cent).

Insurance sector led the gainers' chart as six insurers featured on the day's top gainer's list with Sonarbangla Insurance was the top gainer, rising 10 per cent.

It was followed by Progati Life Insurance (8.48 per cent), Global Insurance (7.28 per cent), Bangladesh General Insurance (7.23 per cent), Dhaka Insurance (7.01 per cent) and United Insurance (6.47 per cent).

Major sectors posted gains with general insurance witnessed the highest gain of 3.80 per cent, followed by financial institutions with 1.50 per cent, banking 0.50 per cent, food 0.50 per cent and pharma 0.30 per cent.

Telecom and textile sectors suffered losses of 0.70 per cent and 0.10 per cent respectively.

Of the 382 issues traded, 177 advanced, 172 declined and 33 remained unchanged on the DSE trading floor.

Two other indices also closed higher. The DS30 index, comprising blue chips, advanced 12.82 points to finish at 2,190 and the DSE Shariah Index (DSES) rose 1.66 points to close at 1,334.

Beximco was the most-traded stock with shares worth Tk 803 million changing hands, followed by IPDC Finance (288 million), Fortune Shoes (Tk 240 million), Kattali Textile (Tk 207 million) and Beximco Pharma (Tk 196 million).

The Chittagong Stock Exchange (CSE) also edged higher with the CSE All Share Price Index - CASPI -rising 49 points to settle at 17,972 and the Selective Categories Index - CSCX -gaining 30 points to close at 10,767.

Of the issues traded, 139 declined, 122 advanced and 37 issues remained unchanged on the CSE.

The port city's bourse traded 9.37 million shares and mutual fund units with turnover value worth Tk 210 million.

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