DSE plunges, but most insurance stocks rise

Dhaka stocks dropped yesterday with the exception of those of insurance, most of which soared.

The DSEX, the benchmark index of Dhaka Stock Exchange (DSE), plunged 51 points, or 0.76 per cent, to 6,702.

Many investors bought insurance stocks on rumours that they would undergo manipulation and that their prices would rise soon, said a stock broker, preferring anonymity.

Among 52 listed insurance stocks, 45 rose and seven dropped, according to the DSE data.

Though these insurance stocks are already overvalued, investors rushed to buy the shares, he said, adding that investors need to be cautious.

The insurance stocks underwent huge fluctuations over the last couple of months riding on rumours, but general investors should not make investments paying heed to such gossip, he added.

Among the major sectors, general insurance rose around 2 per cent on an average while life insurance 1.51 per cent, according to UCB Stock Brokerage's daily market review.

Some stock investors rushed for low paid-up capital-based companies hoping for them to rise, said a merchant banker.

As the stock market regulator ordered all the small capital-based companies to increase their capital, general investors are trying to buy their shares, he added.

At the DSE, 82 stocks advanced, 261 declined and 35 remained the same.

Savar Refractories topped the gainers' list, rising 9.99 per cent, followed by Dacca Dyeing, Miracle Industries, Asia Pacific General Insurance Company and Asia Insurance.

Stocks of Fortune Shoes were traded the most, worth Tk 54 crore, followed by Beximco, Beacon Pharmaceuticals, Asia Insurance and ONE Bank.

Khan Brothers PP Woven Bag Industries shed the most, dropping 8.39 per cent, followed by Imam Button Industries, Apex Footwear, Premier Leasing and Finance and Libra Infusions.

Chittagong Stock Exchange (CSE) also dropped yesterday. The CASPI, the main index of the port city bourse, dropped 133 points, or 0.67 per cent, to 19,534.

Among 297 stocks to undergo trade, 89 rose, 177 fell and 31 remained unchanged.