Except for the bank and food sectors, all other major sectors with a large share of the stock market remained almost flat showing no significant growth in value over the last nearly one year.
Each of the sectors witnessed 8 per cent growth in market value since the re-imposition of the floor price until July 11, but the capital gain was limited to small-cap stocks.
As a result, market recovery remained constrained.
Only Unilever Consumer Care, British American Tobacco Company (BATBC), and Agricultural Marketing Company stand out among the 21 companies of the food & allied sector in terms of financial strength, business growth and corporate governance.
Others are mostly non-performing stocks.
Nineteen companies of the food sector had been above the floor in most sessions during the period. But a large-cap company, BATBC had been stuck at floor.
The two other companies, which were also confined to the floor, are Taufika Foods and Lovello Ice-cream, and BD Thai.
Many stocks of the sector experienced irrational price escalation up to 350 per cent since the regulator reinstated the floor price, but their market share is so negligible that their rising trend could not make any impact on the index.
Emerald Oil Industries, which incurred losses in recent years, surged 350 per cent on the Dhaka Stock Exchange during the period.
Shyampur Sugar Mills, which has not been in operation for a long time, peaked at Tk 119.70, 22 per cent up from the floor price of Tk 98.20, on July 9. It fell to Tk 112.5 last Thursday.
Shares of another junk stock Zeal Bangla Sugar Mills have also been trading at prices above the floor.
The scenario of the banking sector is no less grim.
Of 35 listed banks, six are presently above the floor price. The companies are Standard Bank, Al-Arafa Islami Bank, Rupali Bank, Pubali Bank, Prime Bank and Mercantile Bank.
The sector seems to have done better only because of the listing of two banks. Global Islami Bank raised Tk 4.25 billion while Midland Bank Tk 700 million.
For the newly-listed banks, the sector was able to see a return in market cap despite the fact that most banks remained stuck at the floor price, said Managing Director of Midway Securities Md. Ashequr Rahman.
Soon after the listing, Midland Bank peaked at Tk 16.10. It is still above the floor price. Global Islami Bank, however, fell down the face value of Tk 10.
The market will recover visibly if the sectors comprising large stocks move up on the exchanges with significant share transactions.
During the period, the Dhaka Stock Exchange (DSE) exhibited ups and downs between 6,133 points and 6,341 points.
Blue chip companies own the highest amount of free float shares. Hence they have significant impact on the exchange's broad index. Many of the stocks are from the pharmaceuticals and telecommunication sectors.
In absence of any price discovery, these stocks did not move, said Mr Rahman.
"That's why the market failed to get enough support from the large-cap companies, especially from the blue chip stocks."
Pharmaceuticals & chemicals, bank and telecommunication sectors have market shares ranging from 12 per cent to 16 per cent.
The pharmaceuticals sector saw a 2.40 per cent return during the period while the telecommunication sector declined.
Of large pharmaceutical firms, Beximco Pharmaceuticals and Renata are still stuck at the floor price. Square Pharmaceuticals moved above the floor on Thursday after nearly eight months.
"The market will not move if the major sectors with market movers do not move," said Mr Rahman.
When the market is in a good situation, investors' participation is concentrated on good stocks, he said. On the other hand, small-cap companies with weak fundamentals exhibit movement when the market faces liquidity shortage.
The Bangladesh Securities and Exchange Commission (BSEC) imposed the floor price for the second time on July 27 last year to avert free fall of the market in the wake of Russia's invasion in Ukraine.
After the outbreak of the war, prices of raw materials and import costs shot up curtailing profits of a majority of listed companies.
A decline in profit is another major reason as to why the market has remained stagnant.
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