Weekly analysis: Stocks bouncing higher on positive sentiment

Stocks extended their winning streak for the sixth straight week that ended on Thursday, as investors increased their appetite for large-cap shares.

Stocks continued its post-election rally amid spontaneous participation by enthusiastic investors, taking the core index above 5900-mark last week after more than an 11-month gap, according to market analysts.

A leading broker said investors have regained their confidence in the market after the elections and focused on the financial sector, as this sector will declare year-end earnings results soon.

The banking sector has remained at a low level, which proved lucrative for the investors, he pointed out.

The week featured five trading days as usual. Of them, the market closed higher in four sessions while one saw mild correction.

Week on week, DSEX, the prime index of the Dhaka Stock Exchange (DSE), added 124.44 points or 2.14 per cent to settle at 5,950.

The DSEX recovered 565 points or 10.49 per cent in the past 18 trading sessions of 2019 after losing 859 points or 14 per cent last year.

According to EBL Securities, investors kept their hopes high as the market went through a positive vibe throughout the week.

The total turnover stood at Tk 48.28 billion last week as against Tk 52.71 billion in the previous week.

The daily turnover averaged out at Tk 9.65 billion, registering a decline of 8.42 per cent over the previous week's average of Tk 10.54 billion.

International Leasing Securities said investors kept their focus on the banking sector hoping for a better return, which helped the benchmark index to cross 5,950-point level again since February 18, 2018.

The daily average turnover for the week -- around Tk 10 billion -- remained encouraging, said the stockbroker.

Two other indices followed suit. The DS30 index, comprising blue chips, surged 39.52 points to finish at 2,049 and the DSE Shariah Index closed 11.81 points higher at 1,321.

The market capitalisation of the DSE also rose 1.90 per cent to Tk 4,199 billion, up from Tk 4,121 billion in the previous week.

The banking sector saw the highest gain of 5.90 per cent, followed by the telecommunications sector (5.68 per cent), mutual fund (2.92 per cent), power (2.40 per cent) and financial institutions (0.82 per cent).

On the other hand, engineering, food and pharmaceuticals sectors shed 1.78 per cent, 0.88 per cent and 0.02 per cent respectively.

Gainers outpaced losers, as out of 348 issues traded, 196 advanced, 136 declined and 16 issues remained unchanged on the DSE floor.

The Premier Bank dominated the turnover chart, with 115.17 million shares worth Tk 1.86 billion changing hands.

The insurance companies performed well, as four out of top ten gainers were from the insurance sector. Sonar Bangla Insurance emerged as the week's best performer, posting a gain of 45.19 per cent.

Northern Jute Manufacturing was the week's biggest loser, shedding 18.86 per cent.

The port city bourse, Chittagong Stock Exchange (CSE), also kept gaining, with its CSE All Share Price Index -- CASPI - rising 407 points or 2.28 per cent to settle at 18,265 and the Selective Categories Index -- CSCX - soaring 246 points or 2.27 per cent to finish at 11,036.

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