Weekly analysis: Stocks see big fall as major sectors plunge

Stocks plummeted last week that ended on Thursday, triggered by panic sell-offs, fearing further fall of share prices.

Market operators blamed shrinking of foreign investment, fear of political turmoil ahead of national election coupled with thin participation of institutional investors for the market fall.

Following the sharp fall of indices in the first two days of the week, the Bangladesh Securities and Exchange Commission held an urgent meeting on Tuesday to find out reasons behind the market fall.

After the meeting, the securities regulator urged investors to stay calm as there is virtually no reason behind the recent sharp fall.

The week featured five trading days as usual. Of them, first two sessions lost more than 130 points while last three sessions recovered 31 points.

Week-on-week, the DSEX, the prime index of the Dhaka Stock Exchange (DSE), went down nearly 100 points or 1.85 per cent to settle the week at 5,282.

Two other indices also ended lower. The DS30 index, comprising blue chips, fell 20 points to close at 1,876 and the DSE Shariah Index plunged 19.75 points to end at 1,223.

Bearish sentiment also reflected on the trading activities as total turnover on the DSE came down to Tk 20.47 billion which was Tk 25.51 billion in the week before.

The daily turnover averaged Tk 4.09 billion, registering a fall of 20 per cent over the previous week's average of Tk 5.10 billion.

"Many investors were not confident enough to put in fresh funds on stocks apprehension of political uncertainty ahead of national election, taking the market turnover below Tk 5.0 billion on an average," said a leading broker.

According to International Leasing Securities, the gloomy market outlook kept investors anxious which resulted a big fall of indices.

The stockbroker noted that the shaky investors opted to liquidate their holding of shares to avoid further losses which contributed to the big plunge in indices.

The market rebound some extent in the last three days of the week riding on the news that ICB and DSE shareholders is set to invest about 2.50 billion soon, said the stockbroker.

The textile sector dominated the week's turnover chart, grabbing 16 per cent of the week's total turnover. It was followed by the power with 14 per cent and banking 13 per cent.

The market capitalisation of the DSE also shed Tk 35.28 billion or 0.91 per cent to came down to Tk 3,845 billion, from Tk 3,880 billion in the week before.

Among the major sectors, engineering witnessed the highest correction of 3.84 per cent, followed by power with 2.98 per cent, food 2.97 per cent, banking 1.38 per cent, pharma 0.88 per cent and financial institutions 0.46 per cent.

Telecommunication sector posted the highest gain of 5.34 per cent riding on Grameenphone (GP) as its share price surged by 5.0 per cent to close at Tk 383 each.

GP's share price increased riding on the news that its net profit rose 26.6 per cent to Tk 26.10 billion in the first nine months of the year, compared to the same period a year ago, said a stockbroker.

Earnings per share for January-September were Tk 19.32. It was Tk 15.88 during the same period a year ago.

Of the 346 traded issues, 262 closed lower, 63 ended higher and 21 issues remained unchanged on the DSE floor last week.

Khulna Power Company topped the week's turnover chart with 9.51 million shares worth Tk 1.13 billion changing hands.

The other turnover leaders were Summit Power with Tk 701 million, Delta Life Insurance Tk 688 million, Dragon Sweater Tk 584 million and Beximco Tk 537 million.

Advent Pharma was the week's best performer, posting a gain of 12.87 per cent.

Indo-Bangla Pharmaceuticals emerged as the week's worst player, losing 25.51 per cent to close at Tk 33 each. The company that made share trading debut on October 18 raised Tk 200 million funds by offloading 20 million ordinary shares at an offer price Tk 10 each.

The port city's bourse, Chittagong Stock Exchange (CSE), also saw a substantial loss with its CSE All Share Price Index - CASPI -plunging by 290 points to settle at 16,247.

The Selective Categories Index - CSCX - also slumped 177 points to close the week at 9,843.

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