Stocks extend gains, rise for seventh day

Shares on the Dhaka Stock Exchange rose for the seventh consecutive day yesterday amid renewed buying spree among general investors after the volatility in the foreign exchange regime lessened following the government's move to float the local currency.

The DSEX, the benchmark index of the premier bourse of Bangladesh, added 45 points, or 0.71 per cent, to close the day at 6,497. In the last seven trading sessions, the index advanced 310 points or 5 per cent.

"General investors are buying as their confidence level has received a boost following the stock regulator's several steps aimed at pushing the index up," said an asset manager.

The Bangladesh Securities and Exchange Commission (BSEC) has widened the scope of lending to investors for buying stocks.

Moreover, it brought down the lower limit of the circuit breaker to 2 per cent from the previous 5 per cent, meaning a stock can't fall more than the new ceiling on a single day.

The regulatory steps from the BSEC have boosted the investors' confidence, the asset manager added.

However, the biggest fillip came on Thursday when the central bank said it was floating the exchange rate, allowing the market to decide the exchange rate of the taka against the US dollar depending on demand and supply.

The decision removed clouds gathering over the country's foreign exchange reserves to some extent as reserves have come under pressure in recent months owing to higher imports against moderate exports and remittance flows.

Turnover on the DSE rose 8.57 per cent to Tk 950 crore from the previous session's Tk 875 crore.

The DS-30, which comprises blue-chip stocks, and the DSES, which represents Shariah-compliant companies, rose 18 points and 10 points, respectively.

The investors put fresh bets on the sector-wise issues as they got back their confidence amid rising turnover, said International Leasing Securities in its daily market review.

Institutional fund flows to the large-cap scrips created a bullish vibe among the investors, raising investors' participation.

Among the sectors, general insurance rose 3.2 per cent and food and allied was up 2.2 per cent.

The investors' activity was mostly concentrated on pharmaceuticals, food and allied, and textile sectors.

On the DSE, 202 stocks advanced, 124 declined and 52 remained unchanged.

Prime Insurance topped the gainers' list advancing 9.96 per cent. Meghna Pet Industries, Meghna Condensed Milk, GBB Power, and Rupali Insurance also gained significantly.

Standard Bank shed the most, dropping 4.16 per cent. Imam Button Industries, Gemini Sea Food, Apex Foods and Standard Ceramic Industries were, among, the heavy losers.

Beximco Ltd was the most-traded stock with its shares worth Tk 38 crore changing hands, followed by BDCOM Online, Shepherd Industries, Fu Wang Food, and Orion Pharmaceuticals.