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Stocks fall after 11-day rally

Staff Correspondent | Published: 23:10, Aug 10,2020

 
 

Dhaka stocks on Monday snapped an 11-day rally as a section of investors went for booking some profits while the others continued buying shares amid optimism.

DSEX, the key index of the Dhaka Stock Exchange, shed 0.26 per cent, or 12.09 points, to close at 4,533.05 points on the day. The DSEX gained 180.32 points in the previous session. It gained 468.5 points in the 11-day rally.

Market operators said that investors went for profit taking on Monday after a massive gain in recent rally.

Usually, companies’ shares face some corrections after a huge jump, they said.

Apart from the slight fall in core index, the market remained cheerful on the day that kept other two indices afloat and turnover over Tk 1,000 crore.

A section of investors continued investing in the market while many others who were on the sidelines returned to the market after observing the rally.

Market analysts said that the market regulator Bangladesh Securities and Exchange Commission had taken some initiatives including automation and product diversification to enhance depth in the market.

It also punished some offenders and cancelled a number of IPO proposals for financial flaws in recent days that was hailed by investors and market intermediaries, they said.

The country’s economy is improving as export earnings and remittance have soared in recent times that also created fund flow to the financial market.

The monthly inflow of remittance reached $2.60 billion while export earnings touched record $3.91 billion in July.

The BB unveiled an expansionary  monetary policy for the fiscal year 2020-2021 on July 29 that reduced bank rate and repo rate to 4 per cent and 4.75 per cent respectively.

Investors moved towards the stock market as possibility of earnings from other means of investment has reduced, market operators said.

Insurance companies faced highest correction as Life Insurance and General Insurance sectors dropped by 3.31 per cent and 2.61 per cent respectively after recent surges.

The average share prices of cement, telecommunication and pharmaceuticals advanced by 3.5 per cent, 2.0 per cent and 0.5 per cent respectively.

Turnover on the bourse declined slightly to Tk 1,048.08 crore on Monday compared with that of Tk 1,128.64 crore in the previous trading session.

EBL Securities in its daily market commentary said,

‘Investors’ confidence is growing and they remained active on the market following the securities regulator has taken several initiatives to develop the market and punished some wrongdoers. The gradual reopening of economy and expansionary monetary policy also encouraged investors to put fresh funds on stock,’ it said.

Of the 354 scrips traded on the DSE on Monday, 111 advanced, 217 declined, and 26 remained unchanged.

DSE blue-chip index DS30, however, gained 0.24 per cent, or 3.79 points, to close at 1,544.13 points on the day.

Shariah index DSES also added 0.52 per cent, or 5.6 points, to settle at 1,063.9 points.

Beximco Pharmaceuticals led the turnover chart with its shares worth Tk 41.06 crore changing hands on the day.

Bangladesh Export Import Company, Square Pharmaceuticals, SK Trims Industries, British American Tobacco, Grameenphone, BRAC Bank, Confidence Cement, Bangladesh Submarine Cables Company and LafargeHolcim Bangladesh were the other turnover leaders on the day.

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