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Stocks succumb to profit taking

Turnover slumps 39pc on prime bourse

FE REPORT | September 06, 2022 00:00:00

The benchmark equity index dropped further on Monday, extending the losing streak for a second straight session as shaky investors rushed to lock in profits from quick-gaining stocks.

The market witnessed see-saw trading right from the start of the session, which turned into a free-fall in the later part of the session.

The benchmark DSEX index of the Dhaka Stock Exchange (DSE) finally settled by 58.59 points or 0.90 per cent lower at 6,431. DSEX shed a total of 77 points in the two trading days.

Turnover, a crucial indicator of the market, also plunged to Tk 14 billion, 39 per cent down from the previous day's turnover of Tk 22.96 billion, which was the highest in 11 months.

Market analysts said stocks extended their losing streak amid profit-taking tendency of the investors.

A rumour is going around that the securities regulator might withdraw the 'floor price' restrictions anytime, which added to the selling pressure, said a merchant banker.

However, the Bangladesh Securities and Exchange Commission (BSEC) clarified that no such decision has been taken as yet.

A group is trying to make profit by spreading rumours, so investors should stay alert and not pay heed to rumours, a BSEC official told the media.

According to EBL Securities, stocks tumbled as investors continued their profit-booking sell-off, forcing the majority of the traded issues to witness intense corrections.

Although the market saw volatility in early trading, the selling pressures dominated later part of the session as investors became wary about protecting their unrealised profits from the market, said the stockbroker.

Five large-cap stocks such as Beximco, British American Tobacco, Beximco Pharma, IDLC Finance and Power Grid Company jointly accounted for a 17-point fall in the DSEX, according to amarstock.com, a market data analyst.

Two other indices of DSE also ended lower. The DS30 index, comprising blue chips, shed 17.18 points to finish at 2,285 and the DSE Shariah Index (DSES) fell 5.78 points to close at 1,404.

All the large-cap sectors posted negative performance. The non-bank financial institutions saw the highest loss of 1.41 per cent followed by power (1.26 per cent), engineering (0.83 per cent), food (0.66 per cent), pharma (0.35 per cent), banking (0.26 per cent) and telecoms (0.03 per cent).

The engineering sector kept its dominance in the turnover chart, grabbing 15 per cent of the day's total turnover, closely followed by miscellaneous (14 per cent) and pharmaceuticals (12 per cent).

Losers took a strong lead over the gainers, as out of 369 issues traded, 263 closed lower, 38 higher and 68 others remained unchanged on the DSE trading floor.

JMI Hospital Requisite Manufacturing became the most-traded stock with shares worth Tk 930 million changing hands, followed by Nahee Aluminum Composite Panel, Eastern Housing, Beximco and Orion Pharma.

Sea Pearl Beach Resort & Spa was the day's top gainer, gaining 9.80 per cent while Sonargaon Textiles was the day's worst loser, shedding 9.95 per cent.

The Chittagong Stock Exchange (CSE) also ended lower with the CSE All Share Price Index (CASPI) losing 177 points to settle at 18,904 and its Selective Categories Index (CSCX) falling 106 points to close at 11,330.

Of the issues traded, 184 declined, 49 advanced and 41 issues remained unchanged.

The port-city bourse traded 6.99 million shares and mutual fund units with a turnover value of Tk 267 million.

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