Stocks end flat amid selling pressure

The benchmark equity index closed the week almost flat as a three-day rally lost momentum on the last trading session of the week, with bargain hunters rushing to secure short-term gains amid cautious trading amid subdued sentiment.

During the week, news of the interest rate being revised down on the Tk 30 billion sovereign-guaranteed loan to the Investment Corporation of Bangladesh slightly shifted investor sentiment toward positivity.

However, news of significant fines for trade irregularities stoked negative investor sentiment, leading to increased selling pressure in the final trading session of the week.

As a result, of the five trading days, three sessions saw the market close higher, while two ended lower amid ongoing uncertainties about the market outlook.

The benchmark DSEX index of the Dhaka Stock Exchange (DSE) settled the week more than 4 points or 0.08 per cent higher at 5,196, after losing 163 points in the past two consecutive weeks.

In its weekly analysis, EBL Securities said sellers' strength was witnessed across the trading floor as investors preferred to trim their equity exposures due to lingering concerns over the prevailing political and economic instability.

However, stocks managed to close positive as bargain hunters outnumbered sellers, seeking the opportunity to collect selective stocks at attractive price levels.

This renewed activity was further fuelled by media reports highlighting the central bank revising down the interest rate of the much-needed Tk 30 billion sovereign-guaranteed loan to ICB, which lifted investor sentiment and added momentum to the trading floor, said the stockbroker.

Meanwhile, price appreciation of selective stocks helped the stock indices gain slightly.

Square Pharma, which is considered one of the best performing blue-chip stocks with an excellent reputation, contributed a 14-point rise to the key index alone.

Others index pullers were National Bank, Renata, Olympic Industries and Dragon Sweater as they jointly accounted for a 15-point rise of the index.

However, price erosion of Beximco Pharma, Islami Bank, Kohinoor Chemicals, Padma Oil Company and Bangladesh Steel Re-rolling Mills pared most of the gains as they jointly pushed the key index 24 points lower.

Of two other DSE indices, the DS30 index, a group of 30 prominent companies, dropped around 4.3 points to 1,912 and the DSES index, which represents Shariah-based companies, lost 3 points to close at 1,164.

Turnover, a crucial indicator of the market, stood at Tk 22.22 billion this week, up from Tk 19.06 billion in the previous week.

Accordingly, the average daily turnover rose to Tk 4.44 billion, up 16 per cent from the previous week's average of Tk 3.81 billion.

Investors were mostly active in the banking sector, which accounted for 14 per cent of the week's total turnover, followed by pharma (13.7 per cent) and food sector (11.6 per cent).

Most of the traded stocks saw price erosion, as out of 384 issues traded, 178 closed lower, 166 higher, and 40 remained unchanged.

Most of the major sectors witnessed negative performance this week. The power sector experienced the biggest loss of 1.62 per cent, followed by engineering (0.47 per cent), banking (0.42 per cent), telecommunication (0.33 per cent) and food (0.13 per cent.

NRB Bank was the most-traded stock with shares worth Tk 879 million changing hands, followed by Genex Infosys, Asiatic Laborites, Agni Systems, and Bangladesh Shipping Corporation.

The Chittagong Stock Exchange (CSE) also ended higher, with CSE All Share Price Index (CASPI) rising 49 points to settle at 14,581 and its Selective Categories Index (CSCX) gaining 21 points to 8,871.

The port-city bourse traded 12.78 million shares and mutual fund units with a turnover value of Tk 275 million.

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