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Stocks investors cheer expansionary monetary policy before Eid holidays

Staff Correspondent | Published: 23:49, Jul 30,2020

 
 

Dhaka stocks advanced on Thursday, the last trading day before Eid holidays, as investors increased share buying with the Bangladesh Bank declaring an expansionary monetary policy to revive the country’s economy from pandemic fallout.

DSEX, the key index of the Dhaka Stock Exchange, gained 1.03 per cent, or 43.22 points, to close at 4,214.42 points on the day.

The DSEX gained 137.7 points in the last six sessions.

Thursday’s index was the highest after March 11, 2020 when the index was at 4,231.48 points.

In line with the previous session, the core index started gaining from the very beginning of Thursday’s session and climbed firmly as the time progressed as investors increased share buying on the day, market operators said.

They said that the BB on Wednesday unveiled an expansionary and accommodative monetary policy for the fiscal year 2020-2021 that encouraged many investors to invest in the market.

In the monetary policy, the bank rate was brought down to 4 per cent from 5 per cent.

It also proposed a cut in the repo rate from 5.25 per cent to 4.75 per cent and reverse repo rate from 4.75 per cent to 4 per cent to make funds available for banks at a cheaper rate.

Therefore, fund flow expected to enhance in the financial market that would reduce deposit rate and treasury bond yield.

Market operators said that investors anticipated that the banks would invest in the capital market to get higher profits.

Besides, the media reported that the market regulator asked 42 companies to comply with mandatory 30 per cent joint shareholding by directors.

Investors expected that the directors would buy shares to comply with the order and share prices of the respective companies would gain, market operators said.

Besides, a section of investors may make a pause to share sales before the market goes into Eid-ul-Azha holidays.

Eid-ul-Azha, one of the largest religious festivals of the Muslims, will be celebrated in the country on August 1.

The stock market will remain closed until August 2.

The market has been showing positive momentum from the beginning of July as the country’s economy has been gradually reopening amid the cororavirus pandemic, market operators said.

Share prices of almost all companies plunged in the recent market rout that provoked a section of investors to go for bargain hunting, they said.

Large capitalised companies including Grameenphone, Square Pharmaceuticals and Beximco Pharmaceuticals advanced on the day.

Insurance companies and pharmaceutical companies continued to be the key focus of the investors’ attention.

The coronavirus cases continued rising across the country.

The death toll from the deadly virus rose to 3,083 and the number of total infections stood at 2,34,889 as on Thursday.

Of the 344 scrips traded on the DSE on Thursday, 162 advanced, 58 declined, and 128 remained unchanged.

The turnover on the bourse advanced to Tk 580.9 crore on Thursday compared with that of Tk 399.52 crore in the previous trading session.

The DSES index added 1.22 per cent, or 11.84 points, to settle at 976.49 points.

DSE blue-chip index DS30 gained 1.34 per cent, or 18.84 points, to close at 1,420.63 points on the day.

Beximco Pharmaceuticals led the turnover chart with its shares worth Tk 28.11 crore changing hands on the day.

Pioneer Insurance, Bangladesh Submarine Cables Company, Grameenphone, Square Pharmaceutics, Eastern Insurance, Sonar Bangla Insurance, Beacon Pharmaceuticals, Nahee Aluminium and Linde Bangladesh were the other turnover leaders.

Agni Systems gained the most on the day with a 10-per cent increase in its share prices while GQ Ball Pen Industries was the worst loser, shedding 4.83 per cent.

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