FE Today Logo
Search date: 03-06-2023 Return to current date: Click here

Weekly market review

Stocks rally for fourth straight week on buying spree

Average daily turnover surpasses Tk 11b mark on DSE

FE REPORT | June 03, 2023 00:00:00

Stocks extended their rally for the fourth straight week to Thursday, as smart investors continued to put fresh bets on lucrative shares in anticipation of quick gains amid optimism around the budget which was placed in parliament on the last working day of the week.

The finance minister unveiled the national budget for fiscal year 2023-24, but there is no good news for the stock investors although the market stakeholders put forward a set of proposals for consideration aimed at boosting the ailing market.

Of the five trading days this week, three sessions closed higher while two others saw moderate corrections.

DSEX, the prime index of the Dhaka Stock Exchange (DSE), climbed 29.82 points or 0.47 per cent to settle the week at 6,355.55, the highest since November 8 last year. The DSEX added almost 93 points in the past four weeks.

The DS30 index, which consists of blue-chip companies, also gained 2.83 points to 2,201 and the DSES Index, which represents Shariah-based companies, advanced 8.79 points to 1,379.

Stockbrokers said the market stayed afloat riding on the dominant buying spree on selective issues amid cautious profit-booking in some recently rallied stocks.

EBL Securities said stocks continued its gaining streak as optimistic investors kept chasing the sector-specific issues with quick-gain potential. "The investors perceived it as an opportunity to harness quick gains from the rallying market."

Investors showed their buying appetite for a diversified range of stocks with investors' buying appetite mostly concentrated on the insurance sectors, said the stockbroker.

As a result, both general insurance and life insurance sectors jointly accounted for 30 per cent of the week's total turnover.

However, the market encountered some selling pressure stemming from the profit-booking of some investors who preferred to take a cautious stance ahead of the budget declaration, the stockbroker added.

Stocks bullish spell sustained as the investors' optimistic attitude and sector-wise fund reallocation, said International Leasing Securities.

The optimistic investors are expecting that the budget will be economy-friendly as well as the capital-market friendly, said the stockbroker.

However, the stock market has been completely overlooked in the budget as there is no new incentive for the stock market although existing facilities offered for the stock market will be continued.

Meanwhile, the recent increase in market participation has bolstered confidence across the trading floor.

Consequently, the total turnover stood at Tk 55.22 billion, up from Tk 45.86 billion in the week before. This week also saw single-day biggest turnover of Tk 11.98 billion in seven months on Wednesday.

The average daily turnover also soared 20 per cent to Tk 11.04 billion, compared to the previous week of the prime bourse.

Most sectors saw gains with cement posting the highest return of 5.60 per cent during the week.

In the budget, the government proposed increasing duty on clinker imports, the main raw materials of cement, which would have an impact on the cement makers' profits.

This week, buyers dominated the DSE trading floor, as out of 392 issues traded, 108 closed higher, 81 lower and 203 issues remained unchanged.

Intraco Refueling Station was the weekly turnover leader, with shares worth Tk 1.95 billion changing hands, followed by Navana Pharma, LafargeHolcim, Unique Hotel & Resorts and Bashundhara Paper.

The Chittagong Stock Exchange (CSE) also ended higher with its All Share Price Index (CASPI) rising 118 points to settle at 18,755 and the Selective Categories Index (CSCX) gaining 68 points to close at 11,219.

The port city's bourse traded 21.91 million shares and mutual fund units with turnover value of Tk 818 million during the week.

[email protected]

Share if you like