Stocks rise for 4th week in cautious trading

Staff Correspondent | Published: 00:00, Aug 25,2019


Dhaka stocks advanced in the post-Eid trading week, extending the gaining streak to the fourth consecutive week, as investors continued with cautious investment eyeing dividend declaration of companies whose financial year ended in June.

DSEX, the key index of the DSE, gained 0.68 per cent, or 35.43 points, over the week to close at 5,236.85 points on Thursday, the last trading session of the week.

The DSEX gained 106 points in the last four weeks.

In line with the week before Eid holidays, the market gained in four days, out of 5, in the past week as investors continued with buying shares, especially from the undervalued scrips.

A nine-day closure at the Dhaka Stock Exchange ended on August 17 due to Eid-ul-Azha and weekly holidays.

Besides, the investors went for buying shares of companies whose financial year ended in June and are preparing to declare dividends and earnings results, they said.

They said that the investors expected that the June closing companies would declare better dividends for the investors.

The overall trading on the market, however, was cautious with DSEX gaining moderately or inching up, they said. 

Average share prices of textile, energy, engineering and pharmaceutical sectors advanced 2.6 per cent, 2.3 per cent, 2.1 per cent and 1.6 per cent respectively in the past week.

The financial sectors declined in the week as Bangladesh Bank on Monday directed that the banks must maintain cash reserve ratio and statutory liquidity ratio for their exposure through offshore banking operations.

Banks feared that the new BB rules might worsen liquidity situation in the financial sector.

Average share prices of bank, mutual fund, life insurance and non-bank financial institutions declined by 2.0 per cent, 1.8 per cent, 1.0 per cent and 0.6 per cent respectively.

The share prices of mutual fund sector continued declining as most of the funds declared lower-than-expected dividends for the year ended June this year.

EBL Securities in its weekly market commentary said, ‘Investors have taken position throughout the whole week in June-closing stocks in expectation of positive earnings and dividend yield. Small cap company was trading below their fundamental for the last couple of weeks and bounced back in this trading week.’

‘Though the market had been started with a positive vibe but failed to keep momentum as investors were anxious of the possibility of extra liquidity pressure on the money market for the recent move taken by Bangladesh Bank regarding cash reserve ratio (CRR) and statutory liquidity ratio (SLR) rules for offshore banking operations of scheduled banks,’ it said.

The daily average turnover on DSE dipped to Tk 460.69 crore in last week from Tk 473.91 crore in the previous week.

Out of the 355 issues traded in the week, 212 advanced, 130 declined and 13 remained unchanged.

DS30, the blue-chip index of DSE, gained 0.67 per cent or 12.26 points, to close at 1,850.01 points.

Shariah index DSES added 1.23 per cent, or 14.63 points, to finish at 1,192.22 points.

United Power Generation Company led the turnover chart with its shares worth Tk 163 crore changing hands in the week.

Khulna Power Company, JMI Syringe, Orion Infusion, Fortune Shoes, Monno Ceramic Industries, Bangladesh Shipping Corporation, Beacon Pharmaceuticals, Silco Pharmaceuticals and Coppertech Industries were the other turnover leaders.

Familytex gained the most in the week with a 34.48-per cent increase in its unit prices while Sunlife Insurance Company was the worst loser, shedding 8.89 per cent.

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