Stocks rebound as market sentiment improves

| Updated: December 06, 2021 13:26:58

Stocks rebound as market sentiment improves

Stocks bounced back in the outgoing week, snapping the previous week's big fall, as buoyant investors renewed their appetite for lucrative shares amid positive expectations as the finance ministry has stepped in to resolve a row between the central bank and the securities regulator.

Week on week, DSEX, the prime index of the Dhaka Stock Exchange (DSE), climbed 84.11 points or 1.23 per cent to settle the week at 6,936, after losing 240 points in the week before.

The market was highly influenced by the contradictory statements from the securities regulator and the central bank over some policy matters, which prompted the finance ministry to arrange a coordination meeting on December 7.

Stocks rebounded as expectations grew that the finance ministry's move to resolve the disputes between the Bangladesh Bank and the capital market regulator would yield a better outcome, said a merchant banker.

On Tuesday last, the Bangladesh Bank (BB) and the Bangladesh Securities and Exchange Commission (BSEC) held a meeting over some policy matters related to the stock market.

Soon after the meeting, the securities regulator had claimed that it resolved all the disputes with the central bank, and that the banking regulator was going to address the issues.

However, refuting the claim, the central bank issued a statement the next day, asking the BSEC to change its notification, creating panic among the investors.

In the wake of such development, the finance ministry has convened a meeting with the central bank and the stock market regulator on December 7 to resolve the ongoing issues.

"Hope for a better outcome from the upcoming meeting encouraged investors to put fresh bets on major sector stocks," said to a stockbroker.

Besides, private sector credit growth accelerated to 9.44 per cent in October, the highest in 13 months, as the economy is running in full swing, which also buoyed the investors, he added.

The central bank also decided not to mop up any money from the market as a part of its efforts to ease the ongoing liquidity crunch in the banking sector, which is also a positive impetus for the capital market, he pointed out.

During the week, two other market indices also ended higher. The DS30 index, comprising blue chips, soared 33.07 points to finish at 2,636 and the DSE Shariah Index (DSES) rose 16.53 points to close at 1,458.

Market capitalisation of the DSE also rose by 1.23 per cent, compared to the previous week, to Tk 5,528 billion on Thursday.

The week's total turnover stood at Tk 50.40 billion on the prime bourse as against Tk 63.06 billion in the previous week.

The daily turnover averaged out at Tk 10.07 billion on the country's premier bourse, which was 20 per cent lower than the previous week's average of Tk 12.61 billion.

The market index has seen a sharp rise in the last two sessions of the week because of the high-level meeting arranged to resolve the tussles between two regulators, according to the EBL Securities.

Gainers took a modest lead over the losers, as out of 380 issues traded, 176 closed higher, 168 higher and 36 remained unchanged on the DSE trading floor.

Among the major sectors that posted gains, the power sector saw the highest return of 3.70 per cent, followed by non-bank financial institutions (3.60 per cent), engineering (2.20 per cent), banking (1.80 per cent), pharma (1.70 per cent) and telecom (0.70 per cent).

Beximco topped the turnover chart with shares worth Tk 5.52 billion changing hands, followed by ONE Bank, First Security Islami Bank, IFIC Bank and Delta Life Insurance.

The newly listed Sena Kalyan Insurance was the top gainer, posting a 60.15 per cent gain while Aramit Cement was the worst loser, shedding 21.20 per cent.

The Chittagong Stock Exchange (CSE) also bounced back strongly, with the CSE All Share Price Index (CASPI) rising 196 points to settle at 20,254 and the Selective Categories Index (CSCX) soaring 120 points to close at 12,180.

Of the issues traded, 153 advanced, 162 declined and 24 remained unchanged on the CSE trading floor.

The port city's bourse traded 85.42 million shares and mutual fund units with turnover value of Tk 2.42 billion.

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