Dhaka stocks extend bear run to 12th week

Dhaka stocks inched down last week, stretching the record losing streak to the 12th consecutive week, but the market volatility eased in the week as some institutional investors especially state-run Investment Corporation of Bangladesh went for buying shares amid regulatory intervention.

DSEX, the key index of Dhaka Stock Exchange, dropped by 0.09 per cent, or 4.98 points, over the week to close at 5,321.41 points on Thursday, the last trading session of the week. The index lost 628 points in the 12-week bear run, the longest ever losing streak.

The benchmark index lost 77.47 points in the first two sessions of the week before recovering 72.49 points in the last two sessions. The market was closed on April 14 on the occasion of Pahela Baishakh, the first day of Bangla new year.

Market operators said the index declined sharply in the first two sessions of the week as investors, panicked by the relentless fall in the share prices, continued withdrawing funds from the market.

But the market rebounded in the last two sessions as some institutional investors especially ICB went for heavy buying amid regulatory intervention, they said.

The volatility at the market and ensuing protests against the free-fall left regulator Bangladesh Securities and Exchange Commission with no choice but to find ways to rescue the sinking market, they said.

BSEC chairman M Khairul Hossain in the last couple of weeks held meetings with the exchanges’ officials, market intermediaries and government high-ups to find solutions to the recent plunge at the market.

The 12-week bear run eroded Tk 24,824 crore in market capitalisation, and investors trying to protect their investments were at their wits’ end.

Affected investors took to the streets on Monday, Tuesday and Wednesday of last week protesting against the market plunge. They also demanded immediate resignation of BSEC chief Khairul for his failure in reviving the market.

Market operators said investors lost their confidence and trust on the regulator as it failed to ward off manipulations and wrongdoings in the market and approved initial public offerings of fundamentally weak companies.

The capital market has been passing through a tough phase because of a host of reasons including liquidity shortage in the financial sector, Grameenphone’s tussle with the government over Tk 12,500 crore in dues, rumours involving a number of companies’ foreign investment deals and unregulated share sales by directors of the listed companies, they said.
Among the large capitalised companies, the share prices of United Power Generation Company, Dutch-Bangla Bank, Reckitt Benckiser and Investment Corporation of Bangladesh declined most in last week.

The average share prices of non-bank financial institution, food, pharmaceutical and energy sectors plunged by 3.3 per cent, 2.9 per cent, 1.5 per cent and 1.0 per cent respectively.
The daily average turnover on DSE declined to Tk 308.15 crore in last week from Tk 334.69 crore in the previous week.

‘Most of the sectors exposed poor performance last week. Investors’ lack of confidence lowered the daily average turnover to Tk 300 crore last week as opposed to the previous week’s Tk 330 crore,’ said EBL Securities in its weekly market commentary.

The share prices of general insurance, textile, bank and telecommunication advanced in last week due to institutional buying.

Out of the 351 issues traded last week, 143 declined, 176 advanced and 29 remained unchanged.
DS30, the blue-chip index of DSE, lost 5.40 per cent, or 0.28 points, to close at 1,897.58 points.

Shariah index DSES shed 0.45 per cent, or 5.61 points, to finish at 1,227.62 points.
Fortune Shoes led the turnover chart with its shares worth Tk 76.48 crore changing hands in the week.

Monno Ceramic Industries, Bangladesh Submarine Cable Company, United Power Generation Company, Esquire Knit Composite, Square Pharmaceuticals, Monno Jute Stafflers, Grameenphone, Shurwid Industries and BRAC Bank were the other turnover leaders.

Standard Ceramic Industries gained the most on the day with a 33.78-per cent increase in its share prices while Reckitt Benckiser was the worst loser, shedding 29.81 per cent.
Source: http://www.newagebd.net

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