Stocks gain as market goes into 10-day recess

Staff Correspondent | Published at 10:31pm on March 25, 2020

Dhaka stocks gained on Wednesday before going into a 10-day recess as a section of institutional investors went for buying shares of some companies at the lowest prices set as per the recently introduced circuit breaker but most of the other companies remained at the floor prices due to the growing concern over coronavirus pandemic.

DSEX, the key index of the Dhaka Stock Exchange, advanced by 0.79 per cent, or 31.71 points, to close at 4,008.28 points on the day after losing 8.18 points in the previous session.

The market was flat for most of the session on Wednesday, but rose sharply riding on the late hour buying pressure as some institutional investors went for buying shares before the market went into a 10-day recess, market operators said.

The government has announced public holidays for March 26-April 4 that include weekly holidays to lessen the risk of the spread of novel coronavirus in the country.

Despite a gain on the back of regulatory ceiling on share prices, prices of two-thirds of scrips were traded at the lower limit of the circuit breaker to reflect the actual situation on the market due to the concerns over ongoing coronavirus outbreak in the country.

Of the 356 scrips traded on the bourse on Wednesday, 17 declined, 96 advanced and 236 remained unchanged.

Stock market regulator Bangladesh Securities and Exchange Commission on March 19 set the lowest prices for all equities to save the market from further plunge.

The Institute of Epidemiology Disease Control and Research confirmed on Wednesday that the novel coronavirus had so far killed five people and infected 39 in Bangladesh.

In addition to the public holidays, the government also shut public transports, and extended closing period for educational institutions to contain the spread of the highly contagious virus. It also deployed the army to check public gathering and maintain social distancing.

Market operators said that the measures had brought the business activities to a near standstill, and the magnitude of the impact on the economy was feared to be catastrophic.

Therefore, investors were reluctant to continue trading activities due to the fearful situation in the country, market operators said.

The turnover on the DSE advanced to Tk 348.13 crore on Wednesday compared with Tk 139.54 crore in the previous trading session mainly due to the block trade of Renata Limited shares worth Tk 236.9 crore.

The deadly virus has so far infected 4.25 lakh people and killed 18,962 people across the globe.

EBL Securities in its daily market commentary said that the Dhaka bourse ended its last trading session with a rise in trading activities and the benchmark index before going into a 10-day hiatus.

Institutional investors especially banks injected new funds to shore up the stock market, it said.

The average share prices of bank sector advanced by 1.7 per cent, energy 0.4 per cent, pharmaceuticals 0.3 per cent and textile 0.29 per cent.

DSE blue-chip index DS30 added 0.53 per cent, or 7.05 points, to close at 1,330.83 points on the day.

Shariah index DSES also gained 0.37 per cent, or 3.41 points, to end at 920.68 points.

Renata Limited led the turnover chart with shares worth Tk 6.98 crore changing hands on the day.

Monno Ceramics, Southeast Bank, Square Pharmaceuticals, LafargeHolcim Bangladesh, Central Pharmaceuticals, Orion Pharmaceuticals, Mercantile Bank, Uttara Bank and IFIC Bank were the other turnover leaders.

ACI Formulation gained the most on the day with a 9.88-per cent increase in its share prices while Premier Cement performed the worst, shedding 6.48 per cent.