Stocks return to black after nine days

Stocks in Bangladesh returned to the positive territory yesterday on undergoing a massive fall for nine consecutive trading days. 

The DSEX, the benchmark index of the premier bourse in Bangladesh, rose 30 points or 0.50 per cent to close at 6,082.

In the initial hours of trading, the index suffered a massive drop, at one point going below 6,000 points. But then it turned back.

Investors are in panic, so they were selling shares while many stocks have become lucrative which lured some investors into purchasing those, said a stock broker.

If confidence grows among investors, the index will rise, he said, adding that the main problem was a crisis of confidence.

Investors lost confidence due to the manipulation of many stocks and the current gloomy economic situation of the country, he added.

The stock broker said the current gloom was a result of the foreign exchange reserve going below $40 billion, prevalence of high inflation and continuous devaluation of the local taka against the US dollar.

Bargain hunters showed interest in sector-specific stocks bearing lucrative price as the market lost 315 points in the previous nine days, said International Leasing Securities in its daily market review.

Stocks witnessed a downward trend in the morning session and recovered soon as institutional investors came up to support the market, it said.

Moreover, the central bank called a meeting today regarding bank exposure issues. The investors are expecting positive decisions and so increased their participation which was reflected in the turnover, it added.

Turnover, another key indicator of the market, surged nearly 36 per cent to Tk 639 crore, down from Tk 470 crore on the previous day.

Of the securities traded on the day, 196 advanced, 131 fell and 53 remained unchanged.

Both the DS30, the blue-chip index, and the DSES, the Shariah-based index, advanced 9 points and 3 points respectively.

Among the sectors, ceramics rose 3.3 per cent, textile 2.5 per cent and travel 2.3 per cent while paper dropped 1 per cent, telecom 0.7 per cent and life insurance 0.5 per cent.

Investors' activities were mainly focused on the textile sector (22.9 per cent of the turnover), followed by miscellaneous (11.2 per cent) and pharmaceuticals (10.2 per cent).

Zaheen Spinning topped the gainers' list, rising 9.83 per cent. Matin Spinning Mills, Monno Fabrics, KDS Accessories, and Safko Spinning Mills rose significantly.

Chittagong Stock Exchange (CSE) also rose yesterday. The Caspi, the all share price index of the port city bourse, increased 115 points, or 0.64 per cent, to 17,922.

At the CSE, 111 stocks advanced, 129 fell and 36 remained unchanged.