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Weekly analysis: Stocks extend loss on financial sector slump

Turnover drops 20pc on country's prime bourse


Babul Barman | Published: February 09, 2019 10:58:24 | Updated: February 11, 2019 10:43:32


File Photo (DSE)

Stocks extended their losing streak for the second straight week that ended on Thursday as investors sold financial shares.

Market analysts said most of the investors adopted a 'cautious' stance after announcement of the Bangladesh Bank's monetary policy statement (MPS) while some others started rebalancing their portfolios after analysing the companies' quarterly performance.

A leading broker said a new issue-Genex Infosys-made debut last week (Wednesday) and the newcomer attracted the investors triggering selling pressure on other issues.

Among the major sectors, banking, non-bank financial institutions and insurance sectors suffered the most while power, pharma, food and telecom sectors witnessed gain.

The week saw five trading days as usual. Of them, the market ended lower on three days while two other sessions saw an uptrend.

Week-on-week, the DSEX, the DSE prime index, went down by 9.09 points or 0.16 per cent to settle at 5,812 in the week.

According to International Leasing Securities, stocks witnessed marginal correction as the shaky investors mostly followed a cautious stance after the central bank unveiled its monetary policy for the second half of the current fiscal year.

The stockbroker noted that some investors reshuffled their portfolios following the latest earnings disclosures.

Two other indices, however, ended higher. The DS30 index, comprising blue chips, rose 18.13 points to finish at 2,026 and the DSE Shariah Index advanced 12.80 points to close at 1,323.

The total turnover stood at Tk 41.19 billion last week against Tk 51.71 billion in the week before.

The daily turnover averaged Tk 8.23 billion, registering a decline of 20.33 per cent over the previous week's average of Tk 10.34 billion.

Block trade contributed 1.50 per cent to the total weekly turnover, where stocks like Square Pharmaceuticals, Grameenphone, Glaxo SmithKline, BRAC Bank and Navana CNG dominated the block trade board.

EBL Securities said investors seemed in a mood to rebalance their portfolios amid the ongoing earnings and yearly disclosures.

The market capitalisation of the DSE, however, rose 1.14 per cent to Tk 4,211 billion, from Tk 4,163 billion in the week before.

The general insurance sector posted the highest loss of 7.42 per cent, snapping the recent gain.

It was followed by the life insurance sector losing 4.79 per cent, non-bank financial institutions 2.04 per cent and the banking sector 2.04 per cent.

On the other hand, the power sector posted the highest gain of 3.06 per cent, followed by the pharma sector with 2.73 per cent, food 2.14 per cent and telecom 2.12 per cent.

Losers outnumbered the gainers, as out of 349 issues traded, 208 closed lower, 124 ended higher and 17 issues remained unchanged on the DSE floor.

United Power dominated the turnover chart, with 7.88 million shares worth Tk 3.16 billion changing hands. The power generation company accounted for 7.67 per cent of the week's total turnover.

The other turnover leaders were Bangladesh Submarine Cable Company (Tk 1.83 billion), Khulna Power (Tk 956 million), Grammeenphone (Tk 752 million), and Premier Bank (Tk 751 million).

Multinational companies (MNCs) performed well last week as four out of top ten gainers were from multinational companies.

Berger Paints was the best performer, gaining 25.34 per cent, while Prime Insurance Company was the worst loser, losing 22.05 per cent.

The port city bourse, Chittagong Stock Exchange (CSE), also ended lower, with its CSE All Share Price Index -- CASPI - losing 109 points or 0.61 per cent to settle at 17781 and the Selective Categories Index -- CSCX -shedding 59 points or 0.54 per cent to finish at 10,758.

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