Loose monetary policy ramps up stocks
The rising pace of the stock market index gained higher speeds after the announcement of another expansionary monetary policy for the current fiscal year amidst the pandemic.
The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), rose 56 points, or 0.87 per cent, to 6,481.56 yesterday. This is a continuation of the index going past its highest level.
In the previous two days, the index rose at a slower pace as investors were cautious to see what was coming in the monetary plan. In those days, the index rose 46 points.
As the monetary policy was expansionary, investors are hoping for the money flow to rise in the market, said a stock broker.
So investor participation in the market rose, he said, adding that there was not that many scopes to invest excess liquidity of the banking sector.
Excess liquidity in the banking sector stood at Tk 231,462 crore as of June, up 66 per cent year-on-year and 9 per cent from a month ago, according to BB data.
The stock market may see higher liquidity if people's confidence remains on the market, he added.
Turnover, an important indicator of the market, rose 43 per cent to Tk 2,187 crore compared to the previous day.
Despite announcing on the DSE's website that there is no reason for a rise, S Alam Cold Rolled Steels topped the gainers' list, rising 10 per cent yesterday.
The demand for the stock reached such a high that there was no seller for most of the day.
However, Prime Insurance Company shed the most in the market, falling 9.89 per cent, though the company yesterday published its profits for the first half of the current year stating that it had returned to profits from losses.
Its earnings per share was Tk 0.75 in the current year's first half while it incurred a per share loss of Tk 0.31 year-on-year.
Stocks of Beximco were traded the most, worth Tk 58 crore, followed by Saif Powertec, Orion Pharmaceuticals, GPH Ispat and Fu-Wang Ceramic Industry.
At the DSE, 232 stocks advanced, 118 fell and 25 remained unchanged.
Chattogram Stock Exchange also rose yesterday. The CASPI, the general index of the port city bourse, increased 223 points, or 1.19 per cent, to 18,858.
Among 323 stocks to undergo trade, 231 advanced, 69 fell and 23 remained unchanged.
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