Stock trading on the decline
Trade in the domestic stock market slowed constantly over the past week as investors adopted a cautious approach in their wait for the half-yearly reports of listed companies amid a worsening coronavirus situation.
As such, the average daily turnover of the Dhaka Stock Exchange (DSE) fell 25 per cent to Tk 1,229 crore last week while it was Tk 1,648 crore the week before.
The DSEX, the benchmark index of the Dhaka bourse, lost 78.1 points in total while the DSES and DS30 shed 8.4 points and 33 points respectively at the same time, according to DSE data.
"Investor participation fell as people want to see the earnings of listed companies," said Ahsanur Rahman, chief executive officer of BRAC EPL Stock Brokerage.
Many investors rearranged their portfolios considering the earnings mix while on the other hand, many others took profits as the index rose in previous weeks.
Regarding the effects of Omicron, the latest variant of Covid-19, Rahman said it had some impact on the market during the initial outbreak as people feared a fresh economic fallout.
"But things are getting better now," he added.
The country reported 20 more Covid-linked deaths with 15,440 fresh infections in the 24 hours till Friday morning.
The daily positivity rate rose to its highest-ever 33.37 per cent after testing 46,292 samples, according to the Directorate General of Health Services (DGHS).
The country's previous highest daily positivity rate (32.55 per cent) was logged on July 24 last year.
Stocks witnessed somewhat flat sessions during the last three days of the week as investors mostly followed a "wait-and-see" approach, International Leasing Securities said in its daily market review.
Although the investors' focus was on the miscellaneous sector at the beginning of the week, it shifted to the textile sector by the end of the week as they are anticipating growth in the sector's upcoming quarterly earnings.
The investors' activity was mostly concentrated on the miscellaneous (14.6 per cent), textile (12.4 per cent), and pharmaceuticals and chemical (11.8 per cent) sectors, it added.
Even though investor participation slipped last week, they were not in a selling spree because they are hopeful to see good performance from the companies, according to a top merchant banker.
"As a result, index movement was slightly on the low end, but saved from a big fall," he said.
The merchant banker went on to say that that people are rearranging their portfolios after considering the earnings of their scrips.
Stocks of Walton, one of the top index influencing companies, dropped more than 6 per cent last week after its disclosure of a 30 per cent fall in profits.
"Along with the earnings uncertainty, people have some fear of another nationwide lockdown amid the pandemic," the merchant banker said.
The market's price-to-earnings (P/E) ratio is 16.63, according to LankaBangla Securities. The ceramic sector holds the top sector-wise P/E ratio at 38 while the banking sector holds the lowest with eight.
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