Posts tagged: ঢাকা স্টক এক্সচেঞ্জ

Infographic: TBS

Following the change in government, stocks have surged for four consecutive sessions, fueled by investor optimism for market reforms which began with the resignation of the securities regulator’s chairman.

The Dhaka Stock Exchange’s (DSE) key index, DSEX, jumped by 91 points on the first trading day after the resignation of the Bangladesh Securities and Exchange Commission (BSEC) chairman, Shibli Rubayat Ul Islam, bringing the index above the 6,000 mark for the first time in five months. The index last stood above 6,000 on 12 March.

In its four-session gaining streak, the DSEX increased by 786 points while the market cap increased by Tk68,000 crore.

EBL Securities said in its daily market review, the capital bourse extended its gaining streak for four straight sessions, withstanding intraday volatility as investor euphoria continues with record high market participation in nearly two years, driven by ongoing optimism surrounding recent changes in the country’s political environment.

It further said that the market opened with strong upward momentum, adding 291 points in the first 30 minutes of the session as buyers rushed onto the rallying scrips.

However, indices cooled down due to the subsequent profit-booking sell-offs as the market experienced significant gains in recent times owing to the notable shift in investor sentiment, it added.

Islami Bank played a pivotal role in yesterday’s index rise, contributing 18 points, followed by Grameenphone, BRAC Bank, BAT Bangladesh, and Robi.

Meanwhile, market turnover surged over the Tk2,000 crore mark after around two years. The last time market turnover reached this mark was in September 2022.

Out of the 397 issues traded, 171 advanced, 204 declined and 22 remained unchanged.

On the sectoral front, bank shares contributed the most to the total turnover at 24.5%, followed by pharmaceuticals at 13.2% and telecom at 10.2%.

Grameenphone topped the turnover chart with shares worth Tk138 crore traded, followed by BAT Bangladesh Tk62 crore, BRAC Bank Tk60 crore, and Robi Tk54 crore.

Sectors mostly displayed positive returns, out of which telecom, non-bank financial institution, and mutual fund exhibited the most positive returns on the bourse yesterday, while cement, tannery and services exerted the most corrections.

Mutual funds led the top gainers’ list, with six funds making it to the table. AB Bank 1st Mutual Fund topped the list with a 10% gain, followed by AB Bank, ACI, DBH First Mutual Fund, and Grameen One: Scheme Two.

ICB Asset Management Company, which managed three mutual funds, was the worst performer of the day after announcing poor dividends to their unit holders for the last fiscal year.

ICB AMCL Third NRB Mutual Fund was the worst performer, with its unit price falling by 5.26%, followed by ICB AMCL Sonali Bank Limited 1st Mutual Fund and ICB AMCL Second Mutual Fund.

The port city bourse, Chittagong Stock Exchange, also settled on green terrain. The selected indices CSCX rose by 286 points to 10,418 and all-share price index CASPI surged by 483 points to 17,282.

Infographic: TBS

Nothing lasts forever, whether it’s optimism or pessimism.

The stock market, long governed by radical wishes instead of its rules and norms, appears to be feeling liberated after the political change came through Sheikh Hasina’s resignation as prime minister after one and a half decades.

With the falling undervalued blue-chip stocks’ sharp reversal, DSEX, the broad-based index of the Dhaka Stock Exchange (DSE), surged by 13.3% in three trading sessions to close at a 4.5-month high of 5,924.

“The upward rally in the country’s capital market continues as the relentless buying spree remains prevalent across the trading floor, riding on the rebounded optimism owing to positive expectations over the recent changes in the country’s political environment,” said EBL Securities in its daily market commentary on Thursday.

“Even in the last week, I did not imagine the unfolding strength of the stock market, just like the political events we have come through this week,” Razzak, a corporate executive and a retail investor in Dhaka, told The Business Standard on Thursday.

“The fundamental performance of the economy and listed companies did not change overnight, but investors’ optimism for a better future drove the sharp market reversal.”

Asif Khan, President, CFA Society Bangladesh

“We are all feeling like it is a new Bangladesh where there are no police on the streets and the student volunteers are controlling traffic in a better way. In the stock market, the regulator is not interfering in the name of helping small investors, and still, investors themselves are taking care of the market in a stronger way,” he said.

His equity capital was more than halved in the past six-seven months amid a freefall of blue-chip shares, and he was praying for a miracle, blaming the radical market control mechanism – like the floor price, the imposition of which deprived him of exit opportunities since August 2022—and later, a sudden withdrawal of the floor earlier this year was about to devastate the account.

He was holding onto the investments and now has a large portion of the unrealised losses recovered.

Analysts said the intensifying pessimism in the past few months was hitting the market harder amid a blurry outlook of inflation, interest rates, economic performance, and most importantly, the economic management of the nation.

With the news of Nobel laureate Professor Muhammad Yunus, taking over as the head of the interim government, the sentiment completely reversed.

Market intermediaries, when being verbally dictated by the regulator to keep buying stocks in the past few years, had been reluctant, citing their shortage of funds that could be freshly injected.

With market confidence back, it seems to have been merely an excuse, said the CEO of a top-tier brokerage firm.

Institutions, high-net-worth individuals, and retail investors are now chasing the momentum as the national optimism for a free, fair, and rational society touches them too.

The roaring bulls 

At the extreme of the tensions regarding the student uprising earlier this week, over 300 of the 400 DSE scrips saw no interested buyer at the lowest allowable prices.

In the past three sessions, an increasing number of scrips have been found to hit their top circuits for the day. On Thursday, 127 scrips closed without any sell offer at the allowable maximum price as they expected further runs.

Trading turnover, which shrank to less than Tk208 crore in the DSE, surged to over Tk1,600 crore on Thursday.

DSEX, with increasing momentum for the past three days, rose by 5.45% on Thursday, 3.54% on Wednesday, and 3.8% on Tuesday.

“The indices maintained an upward trajectory with increased market participation throughout the session, as most scrips saw significant price appreciation driven by investors perceiving attractive investment opportunities amid the sustained uptrend,” wrote EBL Securities.

On the sectoral front, pharmaceuticals contributed the maximum 23.7% to the daily turnover in the DSE, followed by the banking and food sectors.

No sector saw a decline in market capitalization. The telecommunications sector, with Grameenphone, Robi, and Bangladesh Submarine Cable Company shares hitting the top circuit, rose by 9%, followed by non-bank financial institutions and banks.

DSE market capitalisation, which is the total market value of all the listed securities, rose by more than Tk58,000 crore in the past three days, of which Tk25,000 crore surged on Thursday, according to the DSE.

Out of the 397 stocks and mutual funds traded, 364 advanced, 27 declined, and 7 remained unchanged.

Meanwhile, CSCX, the broad-based index of the Chittagong Stock Exchange, surged by 5.4% to 10,132 on Thursday.

What is next?

“Many of the blue-chip stocks were too undervalued in June-July,” said Edge Asset Management Chairman Asif Khan, adding, “Yet, investors were not making their stock bets bigger amid the high inflation, interest rates, and a lack of confidence.”

“The fundamental performance of the economy and listed companies did not change overnight, but investors’ optimism for a better future drove the sharp market reversal,” he told TBS on Thursday.

The question of sustaining momentum will be answered by the extent of fulfilment of expectations from the new interim government, in terms of ensuring sustainable reforms and good governance, added Asif Khan, who is also the president of CFA Society Bangladesh, the largest community of Bangladeshi investment professionals.

The benchmark index DSEX of the Dhaka Stock Exchange (DSE) soared by 389 points in the last two days owing to positive expectations over the recent changes in the country’s political environment.

On Wednesday (7 August), the DSEX surged by 192 points and settled at a nearly three-month high of 5,619 points. In the previous session, the DSEX soared by 197 points.

The blue-chip index on the day rose by 87 points to settle at 2,022.

During the day’s session, 266 scrips advanced, while 114 declined and 16 remained unchanged.

The turnover value increased slightly to Tk775 crore.

Moreover, the key index CASPI at the Chittagong Stock Exchange (CSE) ended 545 points higher at 15,938, while the general index CSCX rose 330 points to reach 9,609. The turnover value at the CSE jumped by 28 times to Tk225 crore.

EBL Securities said in its daily market review, the rebounded capital market continued its bullish trend, with the benchmark index increasing by around 200 points for back-to-back sessions as investor euphoria continues across the trading floor owing to positive expectations over the recent changes in the country’s political environment.

Buyers maintained their dominance as optimistic investors kept on chasing the current rallies, while the continuous price appreciation in the major blue chip and large cap scrips added much strength to the upward market momentum, it added.

In the last two sessions, the market capitalisation at the DSE increased by Tk32,600 crore to reach Tk6.79 lakh crore.

Moniruzzaman, managing director and CEO of Prime Bank Securities, told The Business Standard that a number of investors stayed away from the market due to mismanagement, corruption, and a lack of corporate governance during the previous government. General investors were also affected by market manipulators who were facilitated by the authorities.

He said, “Now, after the fall of the government in the face of the movement, investors are coming to the market with the hope that the future government will eliminate mismanagement and corruption and ensure good governance.”

“Moreover, in the last two working days, both institutional and retail investors have been active. The prices of fundamental and large-cap stocks are increasing, which is a good sign for the market,” he added.

On the sectoral front, the pharmaceutical sector contributed to the highest 16.9% of the DSE turnover, followed by bank and food sectors.

During Wednesday’s session, BAT Bangladesh was the top traded stock with a turnover value of Tk54.94 crore, followed by Square Pharmaceuticals with Tk38 crore, Robi with Tk22.84 crore, and City Bank with Tk20.98 crore.

All the sectors, except travel and leisure, jute, paper and tannery displayed positive returns.

Non-bank financial institutions led with a massive 9.4% surge in market capitalisation, followed by telecom and food sectors.

ACI Formulation, Aftab Auto and Monno Ceramic hit the circuit breaker upper limit at 10%, followed by Desh garments, Pragati Insurance and ACI.

Crystal Insurance was worse on the day, followed by Sonali Paper and Sunlife Insurance.

The managing director of Prime Bank Securities said that after the government changed, politically backed firms moved the most.

Saiful Islam, president of the DSE Brokers Association (DBA), said, they want investors to play a responsible role in what they buy during the uncertain situation as the government is not yet formed.