Dhaka stocks surged for the fourth day on Monday as investors continued buying shares heavily amid a host of measures from the government to stabilise the volatile capital market.
DSEX, the key index of the Dhaka Stock Exchange, advanced by 1.19 per cent, or 52.17 points, to close at 4,434.24 points on Monday.
The DSEX gained 398 points in the last four sessions.
In line with the previous day, the core index saw a flying start, gaining 90 points within 15 minutes of the trading session and ended the session buoyant as investors kept heavy buying amid various moves of the government and the Bangladesh Bank to stabilise the market, market operators said.
The market has been gaining for the last four sessions, but the rise intensified in the last two sessions following the move of prime minister Sheikh Hasina to stabilise the market, they said.
A meeting of policymakers in presence of the prime minister at the Prime Minister’s Office on January 16 discussed ways to solve prolonged turmoil on the country’s capital market that powered the DSEX to gain 232 points on Sunday, the highest single-day gain in seven years.
The meeting made a six-point suggestions including increasing of investment of banks and non-bank financial institutions on the capital market, enhancing investment capacity of Investment Corporation of Bangladesh and providing loan facility to the merchant bankers and institutional investors to solve prolonged turmoil on the country’s capital market.
Besides, the media reported that the Bangladesh Bank governor Fazle Kabir on Sunday assured a Bangladesh Merchant Bankers’ Association delegation of stock market supportive policies with a view to addressing the liquidity crisis on the market.
The BB is also working on the stockbrokers’ proposal of Tk 10,000 crore funds to be injected into the capital market, the media reported.
Moreover, BB governor Fazle Kabir on January 14 said that the central bank would extend whatever support it needed to stabilise the stock market while financial institution division senior secretary Ashadul Islam at a meeting on the same day said that the ministry had asked four state-run banks to invest in the capital market.
However, some investors went for selling shares in the middle of the session after an increase in prices of their holdings, fearing any downward trend, market operators said.
The various moves from the government and the BB came following 11 months of relentless fall in the share prices that caused the DSEX to fall to a 56-month low on January 14.
Top brasses of four state-run banks at a meeting held on January 16 at the board room of Sonali Bank head office in Dhaka emphasised an increase in investment on the capital market and also instructed the officials to take necessary steps in this regard.
The BB on Sunday revised its monetary policy for the second half of the fiscal year 2019-2020, raising the target of broad money supply by 0.50 percentage points with a view to boosting investment in the private sector, including the capital market.
Besides, the capital market supervision committee on Monday met with the BMBA to discuss the overall situation on the market.
The BMBA delegates suggested increasing IPO supply on the market, ensuring good companies and providing incentives to enlist better companies on the market.
The share prices of Grameenphone, Sqaure Pharmaceuticals and Beximco Pharmaceuticals soared on Monday that fuelled the market rise.
GP gained almost 13 per cent in the last two sessions following appointment of its Bangladeshi chief executive officer Yasir Azman.
EBL Securities in its daily market commentary said ‘The BMBA’s dialogue with the central bank on Sunday also hinted at the possibility of providing liquidity support through the scheduled banks for a vibrant market. Investors perceived these actions positively and participation increased in the last two sessions.’
The average share prices of telecommunication, non-bank financial institution, bank and energy sectors advanced by 6 per cent, 4.1 per cent, 1.1 per cent and 0.8 per cent respectively.
Out of the 356 scrips traded on Monday, 149 advanced, 161 declined and 44 remained unchanged.
The turnover on the DSE advanced to Tk 494.79 crore on Monday from Tk 411.36 crore in the previous trading session.
DSE blue-chip index DS30 gained 1.85 per cent, or 27.63 points, to close at 1,514.88 points.
Shariah index DSES added 1.74 per cent, or 17.36 points, to end at 1,014.95 points.
Grameenphone led the turnover chart with its shares worth Tk 24.43 crore changing hands on the day.
SS Steel, LafargeHolcim Bangladesh, Square Pharmaceuticals, BRAC Bank, Beacon Pharmaceuticals, Paramount Textiles, Khulna Power Company, ADN Telecom and National Bank were the other turnover leaders.
Gemini Sea Food gained the most on the day with a 9.98-per cent increase in its share prices while SS Steel performed the worst, losing 7.5 per cent.
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