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Stocks drop after 4-day rise

Staff Correspondent | Published: 23:22, Nov 30,2020

 
 

Dhaka stocks dropped on Monday, ending a four-day gaining streak as a section  of investors went for selling shares to book some profits but around one-third companies were stuck in their floor prices.

The Bangladesh Securities and Exchange Commission on March 19 introduced the floor price mechanism to check free fall on the market amid the COVID-19 outbreak in the country. The floor price system prevents the price of a company’s shares from falling below a certain level.

DSEX, the key index of the Dhaka Stock Exchange, dropped by 0.3 per cent, or 14.97 points, to close at 4,866.84 points on Monday after gaining 64 points in the previous four sessions.

The key index started falling from the very beginning of Monday’s session and remained in the negative zone until the end of the session as investors were cautious over the current sluggishness on the market, market operators said.

They said that the market had become static again as around 90 companies were stuck in their floor prices due to the recent bearishness on the market.

Due to a continued domination of insurance and mutual fund sectors, a large number of investors flocked to the sectors by selling off other companies’ shares, they said.

They said that trading value of more than 100 companies was below Tk 5 lakh each that indicated the bleak situation on the market.

Share prices of Beximco Pharmaceuticals, BEXIMCO and Square Pharmaceuticals plunged on Monday that contributed most to Monday’s index fall.

DS30, a composition of 30 large capitalised companies, shed 0.67 per cent, or 11.39 points, to close at 1,687.40 points on the day.

The mutual fund and insurance sectors declined on Monday.

However, the insurance and mutual fund sectors continued dominating the market with the general insurance sector logging 38 per cent and the mutual fund 11 per cent of the day’s total turnover.

In addition to the dominance of only two sectors, overflow of initial public offerings, poor corporate declarations and concerns over looming second wave of coronavirus outbreak have become a heavy drag on the market in recent weeks.

Of the 357 scrips traded on the DSE on Monday, 144 declined, 94 advanced and 111 remained unchanged.

The turnover on the DSE increased to Tk 804.21 crore compared with that of Tk 766.21 crore in the previous session.

Shariah index DSES also declined by 0.61 per cent, 6.94 points, to settle at 1,113.97 points. Beximco Pharmaceuticals led the turnover chart with its shares worth Tk 52.96 crore changing hands on the day.

Rupali Insurance, Bangladesh Export Import Company, Sandhani Life Insurance, Pragati Insurance, Nitol Insurance, Northern Islami Insurance, Asia Insurance, Square Pharmaceuticals and National Feed Mills were the other turnover leaders on the day.

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