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The Financial Express

Weekly stock market review

DSEX dips below 5,600-mark

| Updated: May 14, 2018 11:43:55


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The benchmark index of the Dhaka Stock Exchange (DSE) fell below the 5,600- mark last week that ended on Thursday as most of the investors continued to be on the selling spree amid poor quarterly earnings declarations.

Analysts said the ongoing pessimism, lower-than-expected quarterly earnings results coupled with the upcoming holy month of Ramadan, continued to prompt investors to cash in on stocks while some adopted a 'wait-and-see' stance ahead of the national budget.

"Disappointing first quarter (Q1) earnings results of some companies, including banks, eroded investors confidence and prompted them to sell shares," said an analyst at a leading brokerage firm.

He noted that the risk-averse investors continued to maintain their selling binge amid the ongoing bearish market trend and adopted a cautious stance ahead of Ramadan and the national budget.

The week featured five trading sessions as usual and all five trading sessions closed lower.

Week-on-week, the DSEX, the prime index of the DSE, went down by 111 points or 1.96 per cent to end the week at 5,587.

"In the week a bearish mood sent the index falling below the 5,600-mark following dissatisfactory earnings declarations," commented EBL Securities in its weekly market analysis.

"The downward trend was led by the banking sector as expectation regarding upcoming earnings has been marred by some recent disclosures," said the stockbroker.

Two other indices also ended lower with the DS30 index, comprising blue chips, falling sharply by 55 points to 2,073 and the DSES (Shariah) index losing 12 points to settle at 1,307.

The port city bourse Chittagong Stock Exchange (CSE) also ended lower with the CSE All Share Price Index (CASPI) losing 334 points to settle at 17,261 and Selective Categories Index (CSCX) shedding 210 points to close at 10,429 points.

Turnover, another important indicator of the market, stood at Tk 26.18 billion on the DSE last week against Tk 10.66 billion in the week before, as the week saw five trading sessions instead of the previous week's only two.

The daily turnover averaged Tk 5.23 billion, which was 1.86 per cent lower than the previous week's average of Tk 5.33 billion.

The engineering sector dominated the turnover chart, capturing 19 per cent of the week's total, followed by textile with 16 per cent and pharmaceuticals 12 per cent.

According to International Leasing Securities, the market witnessed a sharp fall in the week amid poor yearend divined and quarterly earnings declarations.

"The shaky investors continued their selling spree ahead of the holy month of Ramadan which brought down the DSEX below 5,600 points after April 1, 2018," said the stockbroker.

"Investors liquidated stocks in the anticipation of poor performance in the first quarter earnings declarations," the stockbroker said.

The stockbroker noted that some investors reshuffled their portfolio and took position in the engineering, fuel & power, service and IT sectors during the week after observing the latest quarterly performance.

The market capitalisation of the DSE also fell 0.86 per cent as it was Tk 3,983 billion on the opening day of the week while it came down to Tk 3,949 billion on Thursday.

Among the major sectors, only engineering and fuel & power saw positive movements while other sectors saw correction.

The losers took a strong lead over the gainers, as out of 341 issues traded, 194 closed lower, 119 advanced and 28 remained unchanged on the DSE floor.

Beximco dominated the turnover chart for the six consecutive weeks with 44.69 million shares worth Tk 1.37 billion changing hands, followed by Western Marine Shipyard with Tk 1.04 billion, United Power Tk 836 million, BBS Cables Tk 668 million and Square Pharmaceuticals Tk 620 million.

SEML Lecture Equity Management Fund was the week's best performer, posting a gain of 30.43 per cent while the BIFC was the week's worst loser, losing 16.85 per cent.

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