Stocks’ slide halted amid institutional support

Staff Correspondent | Published: 00:00, Sep 13,2019


Dhaka stocks ended flat on Thursday after a plunge in the previous session as some institutional investors came forward to support the market while the others maintained cautious trading.

DSEX, the prime index of the Dhaka Stock Exchange, inched up by 0.01 per cent, or 0.71 points, to close at 4,933.89 points on Thursday after losing 100.61 points in the previous two sessions.

The index lost 303 points in last 14 trading sessions with just four positive sessions.

The market dropped sharply at the beginning of Thursday’s session but rebounded and somehow finished in the positive zone as investors remained cautious on the trading floor while some institutional investors went for bargain hunting, market operators said.

They said a section of investors paused share sales when they saw some positive movements at the market.

The market has been suffering from lack of confidence on the part of investors amid prolonged bearish trend and poor regulatory activities, they said.

The latest spell of downfall started since April last year due mainly to volatility in the financial sector, tussle between the market regulator and the DSE over some issues, issuance of huge placement shares by the listed companies.

Grameenphone’s dispute with the Bangladesh Telecommunication Regulatory Commission over an audit claim also contributed to the downward trend.

The financial market has been struggling for liquidity crisis, colossal amount  of non-performing loans, scams and some government’s moves that allegedly assisted some vested quarters, market operators said.

To worsen the liquidity situation, the government recently decided to divert state-owned corporations’ funds worth Tk 2,12,100 crore to the exchequer, borrowed a huge amount of funds from the banking channel and directed the banks to maintain cash reserve ratio for their exposure through offshore banking operations, they said.

The average share prices of pharmaceutical sector dropped by 0.2 per cent, telecommunication 0.19 per cent, bank 0.1 per cent and non-bank financial institution 0.02 per cent.

EBL Securities in its daily market commentary said, ‘The prime bourse closed flat on Thursday after suffering a big shock of 75.8 points loss on Wednesday. Prolonged bearish vibe at the market kept the investors in gloomy mood and they maintained cautious stance despite the fact that the free-fall in stock prices stopped for the time being, mainly supported by institutional investors.’

The average share prices of engineering sector advanced by 0.7 per cent, textile 0.4 per cent and energy 0.2 per cent.

Turnover on the bourse dropped to Tk 405.1 crore on Thursday from Tk 502.42 crore in the previous session.

DS30, the blue-chip index of the DSE, added 0.05 per cent, or 0.87 points, to close at 1,737.06 points.

DSE Shariah index DSES gained 0.11 per cent, or 1.29 points, to close at 1,156.78 points.

JMI Syringe led the turnover chart with its shares worth Tk 21.54 crore changing hands.

National Tubes, Monno Jute Stafflers, Monno Ceramics, Stykecraft, Legacy Footwear, Beacon Pharmaceuticals, Wata Chemicals, Silco Pharmaceuticals and United Power Generation Company were the other turnover leaders.

Usmania Glass Sheet Factory gained the most on the day with a 9.98-per cent increase in its share prices while Sunlife Insurance Company was the worst loser, shedding 6.49 per cent.

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