Stocks drop for 2nd day as banking scrips continue to fall

Staff Correspondent | Published: 22:31, Jul 15,2018

 
 

Dhaka stocks declined for the second day on Sunday as investors kept selling shares, especially bank scrips ahead of their June-end financial disclosures.
DSEX, the key index of Dhaka Stock Exchange, dropped 0.41 per cent, or 22.15 points, to close at 5,336.74 points after losing 20.33 points in the previous trading session.
After a brief upward trend in the beginning of the day, the market began to dip sharply as investors kept selling shares, especially large capitalised scrips including banks and Grameenphone, market operators said.
Investors were rebalancing their portfolios as companies were preparing to declare their June-end financial results, they said.
The financial sector in the country has been going through a tough time and investors have low expectations from the financial companies for the second quarter (March-June), they said.
Most of the banks had declared profit fall in the first quarter compared with that in the same period in the previous year.
Market operators said investors were also sceptical about the implementation of the reduced interest rates by banks and its effectiveness in stabilising the financial market.
The bank owners’ organisation, Bangladesh Association of Banks, on June 20 decided to bring down interest rate to single digit from July 1, but very few banks implemented the rate so far.
The financial sector led the downfall on Sunday with non-bank financial institution and bank sectors falling by 1.5 per cent and 1.3 per cent respectively.
The share price of SK Trims Industries on its debut on Sunday shot up by 325 per cent due mainly to investors’ irrational hype around newly listed companies.
Each share of SK Trims that was issued at Tk 10 closed at Tk 40.9 at the DSE.
The average share prices of miscellaneous, engineering and energy sectors dropped by 1.2 per cent, 0.9 per cent and 0.8 per cent respectively.
‘The market started with optimism as opportunistic investors continued taking position on stocks especially from miscellaneous sector as SK Trims Industries made its debut. However, the market reversed in the later part of the session as risk averse investors exerted selling pressure on stocks especially from telecommunication, bank and financial institutions sectors,’ said EBL Securities in its daily market commentary.
Turnover on the bourse, however, increased to Tk 955.39 crore compared with that of Tk 852.97 crore in the previous trading session.
Of the 339 companies and mutual funds traded, 207 declined, 109 advanced and 23 remained unchanged.
DS30, the blue-chip index of the bourse, also shed 0.60 per cent, or 11.61 points, to close at 1,895.16 points.
Shariah index DSES lost 0.11 per cent, or 1.51 points, to finish at 1,265.86 points.
BBS Cables led the turnover chart with its shares worth Tk 44.93 crore changing hands.
United Power Generation and Distribution Company, SK Trims Industries, Doreen Power, Singer Bangladesh, Paramount Textiles, Bashundhara Paper Mills, Shahjibazar Power Company, Khulna Power Company and Saiham Textile Mills were the other turnover leaders.
Legacy Footwear gained the most on the day with a 9.98-per cent increase in its share prices, while Modern Dying was the worst loser, shedding 8.47 per cent.

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