Stocks jump at opening on banks’ exposure news
The prime index of the Dhaka Stock Exchange (DSE) crossed the 6300-mark in early trading on Wednesday as the bargain hunters put fresh bets on lucrative stocks riding on regulatory support.
The market was on the recovering trend for the last three days after the securities regulator imposed ‘floor price’ on all securities Thursday.
The Ministry of Finance on Tuesday has allowed the banks to calculate capital market exposure on cost price basis instead of market price.
“The news encouraged the investors to put fresh funds on stocks as a result the sale pressure from the banks will reduce when the market rises,” said a stockbroker.
After the news, DSEX, the prime index of the DSE, went up by 77 points or 1.24 per cent to stand at 6,326, after the first hour of trading at 11:00am.
Two other indices saw an upward trend till then. The DS30 Index, which consists of the blue-chip companies, rose 27.64 points to 2,261 while the DSES Index, which represents Shariah-based companies, gained 15.18 points to 1,377.
Turnover, another important indicator of the market, soared to Tk 4.51 billion after the first hour of trading.
Market operators said the bargain hunters showed their buying interest on stocks at a lucrative price while the news of banks’ exposure on cost price basis encouraged the institutional investors in the market.
Some positive macroeconomic news such as higher remittance inflow, rising export, declining import and favorable regulatory interventions increased the market participation, said a merchant banker.
“The growth in turnover pushed investors’ confidence high and high volume suggested that institutional investors were active in the market,” he added.
Of the issues traded till then, 286 advanced, 41 declined and 53 issues remained unchanged on the DSE trading floor till then.
Beximco was the most traded stock till then with shares worth Tk 104 million changing hands, closely followed by Robi, Malek Spinning, Intraco Refueling Station and Fortune Shoes.
The Chittagong Stock Exchange also opened sharply higher with its All Shares Price Index (CASPI)—gaining 184 to stand at 18,503 while the Selective Categories Index – CSCX gained 111 points to reach 11,086, also at 11:00am.
Of the issues traded till then 117 advanced, 29 declined and 38 unchanged with turnover of Tk 38 million till then.