Weekly analysis: Stocks end higher as bank shares keep gaining

FE Report | Published: August 18, 2018 10:25:25 | Updated: August 20, 2018 10:38:10


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Stocks ended higher last week that ended on Thursday as investors showed their buying appetite on large-cap stocks amid post-Eid positive expectation.

Market operators said investors showed their buying spree on largest market-cap Grameenphone (GP) and bank issues as pre-Eid sale pressure eased.

Only two trading sessions -Sunday and Monday -- are left before Eid-ul-Azha vacation.

"The market rebounded as pre-Eid sale pressure faded away while optimistic investors took position on large-cap stocks amid post-Eid optimism," said an analyst at a leading brokerage firm.

He noted that the rally was largely supported by heavyweight banking and telecommunication sectors which posted more than 2.0 per cent gain each.

The banking sector soared 5.16 per cent as 29 banks, out of 30, closed higher last week with four banks soared more than 10 per cent.

The telecom sector witnessed 3.01 per cent return as the GP posted 3.0 per cent gain to close at Tk 375 each on Thursday.

According to International Leasing Securities, the market witnessed bullish trend for the third consecutive week as the optimistic investors showed their appetite for buying on large-cap stocks amid optimism.

The stockbroker noted that enthusiastic investors' increased concentration on the telecom sector stocks "GP" riding on the news of uniform call rate for all the operators for establishing a level playing field which assisted the prime index to cross 5,450 points.

Though the market remained slow in the first two sessions, with the ease of the pre Eid sales pressure the market got back its momentum in the last two sessions, it said.

A leading broker said the banking sector posted the highest gain of 5.16 per cent as some of the banks posted good profit in the second quarter, leading investors to channel some of their money into the banking stocks.

The consolidated earnings per share (EPS) of half of the listed banks increased during the January-June 2018 period.

The week featured four trading sessions as the market closed on Wednesday due to National Mourning Day. Of them, three sessions closed higher while one saw correction.

Week-on-week, DSEX, the prime index of the Dhaka Stock Exchange (DSE), went up by 60.74 points or 1.12 per cent to settle at 5,467.

"Buying of shares mostly from banking, telecommunication, engineering and power stocks contributed the market to close higher," said an analyst at a leading brokerage firm.

Two other indices also ended higher. The DS30 index, comprising blue chips, advanced 22 points to finish at 1,915 and the DSE Shariah index gained 1.04 points to end at 1,247.

Turnover, another indicator of the market, fell to Tk 26.27 million which was Tk 34.37 billion in the week before as last week saw four trading days instead of previous week's five.

The daily turnover averaged Tk 6.56 billion, which was 4.45 per cent lower than the previous week's average of Tk 6.87 billion.

The textile sector continued topped the week's turnover chart, capturing 21 per cent of the week's total turnover, followed by engineering with 18 per cent and banking 17 per cent.

The market capitalisation of the DSE also advanced 0.74 per cent as it was Tk 3,845 billion on opening day of the week while it rose to Tk 3,874 billion on Thursday.

Of the 340 traded issues, 168 closed lower, 161 ended higher and 13 issues remained unchanged on the DSE floor.

BBS Cables continued to dominate the week's turnover chart with 10.75 million shares worth Tk 1.30 billion changing hands.

The other turnover leaders were IFAD Autos with Tk 854 million, Shepherd Industries Tk 698 million, Saiham Textile Tk 550 million and Hamid Fabrics Tk 495 million.

Midas Financing was the week's best performer, posting a gain of 22.60 per cent while Padma Life Insurance was the worst loser, losing 22.08 per cent following the news of its no dividend declaration.

The Chittagong Stock Exchange (CSE) also ended higher with the CSE All Share Price Index - CASPI -advancing 184 points to settle at 16,814.

The Selective Categories Index - CSCX - also gained 113 points to close at 10,181.

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