Stocks snap four-day rally as investors book profit

Shares on the Dhaka Stock Exchange (DSE) broke a four-day rally yesterday amid short-term profit booking and central bank moves that may squeeze fund flows to the bourses.  

The DSEX, the benchmark index of the premier bourse of Bangladesh, was down 4.44 points, or 0.07 per cent, to 6,246.

The DS30, the blue-chip index, retreated 0.31 per cent to 2,201 while the DSES, the index that represents Shariah-based companies, fell 0.17 per cent to 1,362.

Turnover rose slightly to Tk 713 crore a day after the important indicator of the market went past the Tk 700 crore mark for the first time in two months.

Of the issues traded on the DSE, 61 advanced, 116 declined, and 175 were unchanged.

The market fell on the first day after the Bangladesh Bank unveiled the monetary policy for the January-June half of the ongoing financial year.

Turnover rose slightly to Tk 713 crore a day after the important indicator of the market went past the Tk 700 crore mark for the first time in two months

On Sunday, the central bank unveiled a cautiously accommodative monetary policy stance to contain inflationary and exchange rate pressures.

The Bangladesh Bank has increased its policy rates by 25 basis points as it unveiled the monetary policy for the second half of the ongoing fiscal year.

As a result, the repo rate, the interest rate at which the central bank loans money to commercial banks, would be 6 per cent from 5.75 per cent in the first half of 2022-23.

The reverse repo rate, the rate at which the central bank borrows money from commercial banks, has been increased to 4.25 per cent from 4 per cent.

The BB also relaxed the lending rate cap for consumer loans, allowing banks to hike it up to 12 per cent from the current ceiling of 9 per cent.

"All these initiatives may hamper the money flow to the capital market," said International Leasing Securities Ltd in its daily market analysis.

City General Insurance posted the highest appreciation on the day, rising 9.78 per cent, followed by Indo-Bangla Pharmaceuticals, which climbed 9.41 per cent, and BDCOM Online, which was up 8.94 per cent.

Gemini Sea Food Ltd and SK Trims & Industries added more than 6 per cent and Pragati Insurance and Genex Infosys advanced more than 5 per cent.

Popular Life Insurance suffered the sharpest fall, declining 4.67 per cent. Fareast Islami Life Insurance shed 4.14 per cent while Pragati Life Insurance and BD Thai Food & Beverage both gave up more than 4 per cent.

Genex Infosys was the most-traded issue on the day, with its shares worth Tk 64 crore changing hands. Bangladesh Shipping Corporation, Bashundhara Paper Mills, Orion Pharma, and JMI Hospital Requisite Manufacturing also saw significant turnover.

The Caspi, the all-share price index of the Chittagong Stock Exchange, however, rose 9.17 points, or 0.05 per cent, to end the day at 18,440,

Among the securities traded, 40 went up, 65 fell, and 97 did not show any price movement.

Turnover on the bourse in the port city was up more than 13 per cent to Tk 17.29 crore from a day earlier.