Stocks inch up as institutional investors keep supporting market

Staff Correspondent | Published: 00:00, Jul 18,2019


Dhaka stocks inched up on Wednesday, adding to the previous day’s gains, as some institutional investors continued to give support to the volatile market.

DSEX, the key index of Dhaka Stock Exchange, added 0.16 per cent, or 8.68 points, to close at 5,133.13 points on Wednesday after gaining 32.96 points in the previous session.

Before the two-day gain, DSEX had lost 289 points in seven-day rout over a number of issues including the Bangladesh Bank move to liquidate the crisis-hit Peoples Leasing and Financial Services.

The trading was choppy throughout Wednesday as the DSEX finished the session with a marginal gain as some investors, especially the institutional ones like Investment Corporation of Bangladesh, gave the market support by buying shares whenever the index went into negative, said market operators.

Some investors also went into bargain hunting share purchase following Bangladesh Securities and Exchange Commission decision to tighten the public issue rules and bar mutual funds from disbursing stock dividend.

‘Although the market gained marginally on Wednesday, many of the investors still remained shaky about the market following the recent rout. We need to see how market behaves in next few days keeping in minds the other issues like PLFS’ liquidation and Grameenphone’s tussle with its regulator ,’ said a stockbroker.

BSEC on Tuesday brought changes to public issue rules, tightening initial public offering process, raising IPO quota facility for the general investors and putting a two-year ‘lock-in’ on placement shares.

Besides, the market regulator barred the asset management companies from giving re-investment unit for mutual funds and encouraged them to give cash dividend.

As a result of hike in lock-in period for placement shares, the prices of newly listed scrips like Silco Pharma, Indo Bangla Pharma, Silva Pharma and New Line Clothings rose sharply on Wednesday.

Prices of mutual funds also marked sharp gains on the day because of the BSEC decision barring re-investment units.

Share prices of Sea Pearl Beach Resort, however, fell over 4 per cent on Wednesday after its share prices had soared, entering into danger zone, in its debut trading on Tuesday.

EBL Securities in its daily market commentary said, ‘The capital bourse of the country witnessed another winning session today [Wednesday] as investors took fresh positions at lucrative prices in sector-specific stocks.’

Investors’ sentiment regarding the market remained positive and buoyancy prevailed throughout the session as new rules of disbursing only cash dividend for mutual funds showing optimism towards the market, it said.

Average share and unit prices of mutual funds, textile, bank and non-bank financial institutions sectors advanced by 4.2 per cent, 0.7 per cent, 0.4 per cent and 0.3 per cent respectively.

Average share prices of telecommunication and food sectors dropped by 0.7 per cent and 0.5 per cent respectively.

Turnover on the bourse increased slightly to Tk 309.60 crore on Wednesday from Tk 271.76 crore in the previous session.

Out of the 353 scrips traded on the day, 196 advanced, 118 declined and 38 remained unchanged.

DS30, the blue-chip index of DSE, added 0.02 per cent, or 0.54 points, to close at 1,830.02 points.

DSE Shariah index DSES gained 0.13 per cent, or 1.59 points, to close at 1,176.88 points.

Fortune Shoes led the turnover chart with its shares worth Tk 23.19 crore changing hands.

United Power Generation Company, Silco Pharmaceuticals, Grameenphone, Global Insurance, National  Polymer Industries, JMI Syringe, Sinobangla Industries, Federal Insurance and Bangladesh Shipping Corporation were the other turnover leaders.

Eastern Insurance Company gained the most on the day with a 9.90-per cent increase in its share price while Bangladesh Industrial Finance was the worst loser, shedding 8.57 per cent.

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