Stocks up for regulatory move

The stock markets in Bangladesh rose for the second consecutive day yesterday largely because of the regulator's move aimed at increasing the participation of institutional investors amid persisting uncertainty.  

The Bangladesh Securities and Exchange Commission (BSEC) stepped in after both Dhaka and Chittagong stock exchanges fell for nine straight days to July 24 as the economic crisis at home and abroad has kept weighing on investors' sentiment.

The DSEX, the benchmark index of the Dhaka Stock Exchange, edged up 29 points, or 0.48 per cent, to close at 6,112, adding to Monday's gains.

The turnaround came after the BSEC talked to institutional investors and brokerage firms to encourage investors to inject funds into the market. This has impacted the market positively, said a stockbroker.

BSEC stepped in after stocks fell for nine straight days as the economic crisis at home and abroad kept weighing on investor sentiment

"The regulator asked institutional investors to buy shares at a large volume in the first hour of the trading, lifting the index," he said.

Consequently, the DSEX surged more than 100 points in the first hour of the day's trading. The momentum, however, did not last since general investors are overall in a selling mood amid dragging uncertainties caused by the ongoing Ukraine war, the coronavirus pandemic, and higher inflation, the broker added.

Turnover, another key indicator of the market, surged 31 per cent to Tk 838 crore, up from Tk 639 crore on the previous day.

The institutional investors along with the high-net-worth individual investors increased their participation in the market after the regulator held a meeting with them on Monday regarding the flow of funds to the capital market, said International Leasing Securities in its daily market review.

The bargain-hunters put fresh bets on sector-wise issues as they find some stocks at lucrative prices, it added.

Among the sectors, general insurance surged 3.8 per cent, tannery rose 2.5 per cent and mutual funds were up 1.6 per cent.

The ceramic sector dropped 1.6 per cent, jute fell 0.7 per cent, and telecom was down 0.7 per cent.

The investors' activities were mainly focused on the textile sector, capturing 23.3 per cent of the day's total turnover, followed by pharmaceuticals, which accounted for 9.2 per cent.

Of the securities traded on the day on the premier bourse of the country, 177 advanced, 172 fell, and 33 were unchanged.

Both the DS30, the blue-chip index, and the DSES, the Shariah-based index, advanced 12 points and 1 point, respectively.

Sonar Bangla Insurance topped the gainers' list rising 10 per cent. Kattali Textile, Phoenix Finance 1st Mutual Fund, SEML Lecture Equity Management, and Global Insurance also rose significantly.

Shyampur Sugar Mills was the worst-performing stock on the day, giving up 2 per cent. Renwick Jajneswar, Legacy Footwear, Savar Refractories, and Northern Jute Manufacturing were among the top losers.

Beximco Ltd was the most traded stock, with its shares worth Tk 80 crore changing hands. IPDC Finance, Fortune Shoes, Kattali Textile, and Beximco Pharmaceuticals also saw heavy trading.

The Chittagong Stock Exchange also rose. The CASPI, the all-share price index of the bourse in the port city, advanced 49 points, or 0.27 per cent, to 17,972.

On the CSE, 122 stocks advanced, 139 fell, and 37 did not see any price movement.