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DSE turnover hits 11-month high as BB’s spl fund encourages investors

Staff Correspondent | Published: 23:04, Feb 12,2020

 
 

Dhaka stocks gained marginally on Wednesday after a surge in the previous day with the turnover on the bourse hitting an 11-month high as a section of investors continued buying shares amid the Bangladesh Bank’s move regarding special fund for the ailing market.

DSEX, the key index of Dhaka Stock Exchange, added 0.20 per cent, or 9.31 points, to close at 4,480.83 points on the day after gaining 85.96 points in the previous session.

Before the two-day gains, the DSEX had lost 121 points in five sessions.

The key index opened positive on Wednesday, gaining 35 points within an hour of the day’s session as a section of investors kept buying shares amid enthusiasm over the BB’s special fund for stock market, market operators said.

The turnover on the DSE advanced to Tk 657.19 crore on Wednesday from Tk 505.85 crore in the previous trading session.

Wednesday’s turnover on the bourse was the highest since March 4 last year when it was Tk 682.01 crore.

But, the index began to fall to end with a slight gain as some investors went for selling shares after a massive gain in the previous day, market operators said.

The BB on Monday issued a circular allowing 59 schedule banks to form a Tk 200-crore special fund each by taking low-interest loans from the central bank to invest in the stock market.

The central bank would issue the fund to the banks against the treasury bills or bonds held by them at the rate of 5 per cent.

Market operators said that the BB move instilled enthusiasm into the market which had been volatile over the coronavirus outbreak in China, poor financial data by the companies, and lack of confidence of investors in the market.

But, the central bank tagged several conditions, barring banks from investing the fund in the market on a whim.

Stock market analysts said that many investors were assessing how the banks and market intermediaries would use the funds on the market after complying with the central bank’s conditions.

Besides, the media reported that the foreign investors had been withdrawing funds from the country’s capital market and pulled Tk 1,114 crore out of the market in the last 11 months.

Share prices of large capitalised companies including Grameenphone, Square Pharmaceuticals and British American Tobacco Bangladesh dropped on Wednesday.

EBL Securities in its daily market commentary said, ‘The market started on a flying note but began to lose the momentum during mid-session as a section of investors booked quick profits due to price appreciation of many stocks after yesterday’s [Tuesday’s] rally, however investors participation was vibrant on Wednesday’s trading floor in hope of the awaited market recovery from the prolonged bearish run since the second half of the last year.’

The average share prices of non-bank financial institution sector advanced by 4.1 per cent, textile by 1.4 per cent, pharmaceutical by 0.4 per cent and energy by 0.1 per cent.

Telecommunication dropped by 1.0 per cent, life insurance 0.9 per cent, general insurance 0.8 per cent and bank 0.1 per cent.

Out of the 356 scrips traded on Wednesday, 160 advanced, 146 declined and 49 remained unchanged.

DSE blue-chip index DS30, however, shed 0.07 per cent, or 1.16 points, to close at 1,516.06 points.

Shariah index DSES gained 0.05 per cent, or 0.56 points, to end at 1,030.69 points.

Shepherded Industries led the turnover chart with its shares worth Tk 30.79 crore changing hands on the day.

LafargeHolcim Bangladesh, Orion Infusions, Khulna Power Company, Indo-Bangla Pharmaceuticals, ADN Telecom, Bangladesh Submarine Cable Company, SK Trims Industries, SS Steel and Saif Powertech were the other turnover leaders.

ICB Employees Provident MF 1: Scheme 1 gained the most on the day with a 10-per cent increase in its share prices while Shyampur Sugar Mills performed the worst, losing 7.78 per cent.

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