Stocks end flat amid volatility

Equity benchmark index ended a highly volatile week on a flat note, as cautious investors chose to sit on the sidelines amid ongoing regulatory moves to address market irregularities.

The stock market regulator took a number of decisions this week, including opening a probe into allegations of irregularities involving former private industry and investment adviser Salman F Rahman and S Alam Group Chairman Mohammed Saiful Alam.

Mr Salman and Mr Alam were trusted people of former prime minister Sheikh Hasina until her downfall on August 5. A four-member probe committee asked to submit a report within 60 days.

Also, the Bangladesh Securities and Exchange Commission (BSEC) sought travel ban on top brasses of Dhanmondi Securities and PFI Securities for embezzling clients' funds and gave an order to freeze their beneficiary owner's accounts.

In another development, the regulator's staffers got divided into groups fighting with each other and seeking protection from the fallout of the changing political landscape.

Amid these developments, the market opened the week on a negative note, losing more than 98 points in the first two trading days as investors opted to trim their exposures.

However, bargain hunters stepped in to drive the prime index up by 96 points, as they took positions on certain issues which saw corrections to secure short-term gains.

The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), settled the week more than 2 points or 0.04 per cent lower at 5,726. The DSEX shed 78 points in the past two straight weeks.

The blue-chip DS30 index, a group of 30 prominent companies, fell 14 points to 2,101. However, the DSES index, which represents Shariah-based companies, gained 17 points to 1,245.

"The formation of a taskforce to reform the banking sector, marginal decline in inflation and continued strong remittance inflows worked as positive catalysts to restore the confidence in the later part of the week," said EBL Securities.

The overall market, however, remained volatile since many investors looked for short-term profit-booking opportunities amid subdued sentiment, said the stockbroker.

On the other hand, a section of investors continued to sell-off their holdings, including some listed ones, amid ongoing demonstrations by workers at several factories on the outskirts of the capital.

If such labour unrest continues, there will be a long-term impact on production and as well as profitability of those listed companies, market operators said.

However, the opportunistic investors opted to take positions in sector-specific issues ahead of earnings declaration.

Islami Bank, Beacon Pharma, Khan Brothers, Kohinoor Chemicals and Bangladesh Submarine Cable contributed positively to the index rise while price fall of BAT Bangladesh, Olympic Industries, Brac Bank, Confidence Cement and Grameenphone offset the gains.

As overall market sentiment remains subdued, the total weekly turnover came down to Tk 32.21 billion this week, as against Tk 32.21 billion in the week before.

Accordingly, the average daily turnover stood at Tk 6.44 billion, which was 19 per cent lower than the previous week's average of Tk 7.99 billion.

Investors were mostly active in the pharma sector, which accounted for 18.5 per cent of total weekly turnover, followed by banking (17.6 per cent) and power (10.3 per cent).

The gainers took a strong lead over the losers, as out of 396 issues traded, 271 declined, 107 advanced while 18 issues remained unchanged.

Most of the sectors saw price erosion. Among the major sectors, non-bank financial institutions witnessed the highest loss of 4 per cent, followed by engineering, food, power, telecom and banking.

Linde Bangladesh became the most-traded, with shares worth Tk 1.70 billion changing hands, closely followed by Olympic Industries, BRAC Bank, Agni System and NRB Bank.

National Tea Company was the top gainer with a rise of 52 per cent, while Confidence Cement was the top loser, shedding 18.7 per cent.

The Chittagong Stock Exchange (CSE) also ended sharply lower with its All Share Price Index (CASPI) losing 238 points to settle at 16,140 while the Selective Categories Index (CSCX) lost 146 points to settle at 9,729.

The port city bourse traded 11.18 million shares and mutual fund units with a turnover volume of Tk 355 million.

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