Dhaka stocks rebounded on Monday after a sharp decline in the previous session as investors went for buying shares amid media reports that Bangladesh Bank would raise the private sector credit growth target for the January-June period of this fiscal year.
The central bank on the day indeed raised the target to 16.8 per cent for the second half of the fiscal year (2017-18) in the monetary policy statement it announced after the trading hours at the stock exchange.
DSEX, the key index of Dhaka Stock Exchange, gained 0.51 per cent, or 31.72 points, to close at 6,176.44 points on Monday after losing 71.07 points in the previous trading session.
The market opened the day on negative note but very quickly changed direction as investors’ concerns over the monetary policy eased thanks to the media reports, stockbrokers said.
The media reported on Monday that Bangladesh Bank would declare its monetary policy on the day with a possibility of raising the private sector credit growth target to about 16.8 per cent for the second half of the fiscal year to match with the higher demand for money supply in the market and to help the government achieve 7.4 per cent GDP growth.
Earlier, the BB in the MPS for the first half of this fiscal year had announced that the target would be 16.3 per cent for the second half.
For the first half (July-December) of FY18, the target was set at 16.2 per cent but the actual rate increased to 18.1 per cent in December.
Stockbrokers said the news about raising credit growth target eased investors’ deep concern over the MPS for the second half that had resulted in a bearish trend at the market for more than three weeks.
The media also reported that the central bank was likely to cut the banks’ advance-deposit ratio less than it earlier had hinted. The BB would announce the banks’ ADR today.
The BB earlier had said that it would announce the MPS keeping the private sector credit growth at the same rate of 16.2 per cent and cutting the banks’ ADR that dampened the investors’ mood.
Investors feared that a cut in banks’ ADR and contractionary monetary policy would result in a liquidity crisis at the market, stockbrokers said.
On Monday, all the large capitalised sectors except cement increased that helped the market rebound.
The average share prices of food, pharmaceuticals, telecommunication and bank sectors increased by 3.39 per cent, 1.34 per cent, 0.86 per cent and 0.22 per cent respectively.
Among the prominent scrips, the share prices of National Bank, Square Pharmaceuticals and Grameenphone surged by 3.9 per cent, 1.8 per cent and 1.0 per cent respectively. The turnover at the bourse also increased to Tk 413.16 crore from that of Tk 359.28 crore in the previous session.
Of the 333 companies and mutual funds traded, 170 advanced, 114 declined, and 50 remained unchanged.
DS30, the blue-chip index of the DSE, added 0.56 per cent, or 12.82 points, to close at 2,293.96 points.
Shariah index DSES also increased by 0.84 per cent, 11.89 points, to close at 1,425.44 points.
Square Pharmaceuticals led the turnover chart on the day with its shares worth Tk 20.95 crore changing hands.
National Bank, Grameenphone, Nahee Aluminum Composite Panel, Paramount Textiles, Alif Industries Limited, BD Finance, Monno Ceramics, BRAC Bank and IFAD Autos were the other turnover leaders.
Nahee Aluminum Composite Panel was the top gainer with a 9.91-per cent rise in its share prices, while Imam Button was the worst loser, shedding 6.08 per cent.
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