Stocks end week on high note

The Dhaka Stock Exchange (DSE) ended the week on a high note, having recovered 56.6 points in its benchmark index, while subsidiaries of Orion Group topped the gainers' list and secured the highest turnover all throughout.

Over the four days the market was active this past week, Beacon Pharmaceuticals made the highest contribution of 48 points to the DSEX, the prime index of the DSE, followed by Orion Infusion, Orion Pharmaceuticals and Kohinoor Chemical.

Stocks of Orion Infusion made the biggest climb by jumping up 29 per cent while Beacon Pharmaceuticals rose 20 per cent, and Bangladesh Monospool Paper Manufacturing and BDCOM Online both advanced 16 per cent.

On condition of anonymity, a merchant banker said Orion Pharmaceuticals, Orion Infusion and Kohinoor Chemical were among the most significant contributors to the DSEX this past week as there are speculations that the stocks of these three companies will rise.

"But investors should be careful when investing in these stocks as they replied to the DSE's query saying they have no undisclosed information behind the recent abnormal price hike," he added.

Stocks of Orion Infusion made the biggest climb by jumping 29 per cent while Beacon Pharma rose 20 per cent, and Bangladesh Monospool Paper and BDCOM Online both advanced 16 per cent

The June-closing scrips earned positive returns throughout the week amid the investors' expectation of satisfactory year-end declarations, International Leasing Securities said in its weekly market analysis.

The central bank had raised the repo rate by 25 basis points to 5.75 per cent last Sunday to curb inflation, which soared to a decade-high 9.8 per cent in August.

In addition, export earnings and remittance respectively declined by 6.25 per cent and 11 per cent year-on-year in September, which widened the trade deficit and increased pressure on the country's foreign exchange reserves.

These developments created a negative sentiment among investors and so, most stocks and sectors were in the red. However, the index rose thanks to the big jump of a few companies, it added.

The Shariah-compliant index, DSES, and index for blue-chip companies, DS30, gained 23.7 points and 31.1 points respectively throughout the week.

On the other hand, average turnover of the Dhaka bourse dropped 9.7 per cent to Tk 1,319.5 crore compared to what it was the previous week.

Among all sectors, pharmaceuticals rose 3.9 per cent and engineering advanced 1.8 per cent while travel and leisure dropped 3.3 per cent, life insurance fell 2.4 per cent and miscellaneous edged down 1.8 per cent.

Investors activity was mostly concentrated on the pharmaceutical (18.6 per cent), engineering (17 per cent) and miscellaneous (14.3 per cent) sectors.

Traders had hoped that the decline in freight rates would have a positive impact on certain listed companies at it may reduce their shipping costs, according to a stockbroker preferring anonymity.

Vessel operations on the Chattogram-Europe route now cost $6,000 to $7,000 per 20-foot container in contrast to $12,500 in December 2021, when the pandemic was at its peak, as per data from the Shipping Agents' Association.

Similarly, a US-bound ship now charges $10,000 per 20-foot container, down from $20,000 previously, the data shows.

"The easing in supply chain disruptions, which had been built up over the pandemic, is also driving the significant fall in freight rates," he said.

However, exchange rate fluctuations have created some risks for companies whose raw materials are import based, he added.