Stocks rise on optimism

Stocks gained 3.59 percent yesterday as investors made fresh exposure hoping that normalcy will be back following the prime minister's intervention the previous day.
The benchmark general index, DGEN, of the Dhaka Stock Exchange went up 179.39 points to end the week's last day at 5,166.96.
In an effort to bring back normalcy in the market the government took long- and short-term steps to stabilise it and compensate those who lost money to downswings.
The government will come up with a detailed plan within a couple of days to prop up the market.
Investors are waiting to see what measures will be taken for them, said a market analyst.
The government also decided not to question the source of undisclosed money to be invested in stocks. Commercial banks also agreed to make fresh investment in the market.
Mirza Azizul Islam, a former adviser to a caretaker government, said the government's initiatives provided a short-term gain and will stop irrational crisis in the market.
“Morally I do not support the investment of undisclosed money, as it will increase the tendency of making illegal money,” said Islam, also a former chairman of the Securities and Exchange Commission.
He said the initiative of compensation will create “moral hazards” among the investors.
They lost money in the market due to their wrong decision and if the government compensates them, they will go for further risky investment, he said, adding that commercial banks also go for investment considering individuals' basic solvency.
He also said the investors should change their behaviour of investment for the long-term development of the bourses and they should invest in fundamental shares with proper analysis.
The market started the day with a positive tempo and continued to rise for the rest of the day as many shares hit the day's upper circuit breaker.
Of the total 255 issues traded on the DSE, 238 advanced and 16 declined. One issue remained unchanged.
The turnover on the DSE stood at Tk 416 crore, which is 46.1 percent higher than that of the previous day.
The Chittagong Stock Exchange also gained yesterday with its Selective Categories Index, CSCX, increasing by 221.71 points or 2.43 percent to close at 9,358.01.