FE Report

The Dhaka Stock Exchange (DSE) continued to show a bullish trend for the eighth consecutive week that ended Thursday on the back of positive budgetary measures, which boosted the investor confidence.

The DSE General Index (DGEN), the benchmark of the prime bourse, surged by 178.66 points or 6.18 per cent to finish at 3069.71, thanks to a sharp rise in share prices of financial institutions.

The average daily turnover in the week increased by 20 per cent to Tk 8.88 billion from the previous week's Tk 7.40 billion, despite a hoax bomb threat Monday and shortening of its trading sessions from five to four due to the bank holiday Wednesday last.

Factors that boosted investor confidence are corporate tax cut, the opportunity to invest untaxed money and the forthcoming release of a number of mutual funds, that took the market to a new height.

In the final session, the daily turnover hit Tk 11.50 billion for the first time in history, which is about three times higher than the figure recorded even two months back.

The market showed a tremendous uptrend in the week as optimistic investors flocked to invest in the capital market with expectation that entry of undisclosed money might boost the market further in the months to come.

By allowing tax incentives for the listed companies, the government is encouraging new companies to become listed with bourses. It will help ensure entry of quality stocks into the market and bring an equilibrium, according to the weekly analysis of the Equity Partners Ltd, an investment bank.

The All Shares Price Index (DSI) gained 151.67 points or 6.27 per cent to close at 2568.78. The DSE-20 blue chip index was up by 165.01 points or 7.04 per cent to finish at 2509.63.

Out of 300 issues traded in the week, 192 gained, 72 declined and two remained unchanged while 34 were not traded.

Banking issues, which were under pressure over the years due to the global financial downturn, shined in the week because of the corporate tax cut, which will help improve their corporate earnings.

Fuel and power sector issues gained but the pace of gaining slowed down as investors were taking a strategic shift toward the financial sector as well as those, which did not move much in the last couple of months.

The cement sector also gained, although it witnessed profit taking on the last trading day.

Heidelberg, which was a big beneficiary of the low clinker price in the international market, gained as their projected future earnings growth largely depends on the price.

Among the other big gainers, IT issues rose by more than 12 per cent in the week with a significant boost in the sector's turnover.

Beximco Pharma, one of the leading drug makers, was the week's top turnover leader with shares worth Tk 2.79 billion traded, accounting for 7.88 per cent of the total turnover of Tk 35.49 billion.

The next other turnover leaders were Beximco Ltd, Titas Gas, AB Bank, Bextex Ltd, Summit Power, Lanka Bangla Finance, Power Grid, Shinepukur Ceramics Ltd and Islami Bank.

The Mercantile Bank was the week's top gainer with a rise of 35.55 per cent in its share price.

The next other top gainers of the week were Rahima Food, Jute Spinners, BDCOM Online Ltd, Southeast Bank, Prime Finance, Premier Bank and Peoples Insurance.

Padma Cement, the week's top loser, dropped 17.47 per cent on price correction.

Imam Button, Tallu Spinning, Prime Textile, Delta Spinners, Eagle Star Textile and Anlima Yarn were the other losers in the week.

The A-category issues accounted for 87.59 per cent of the total turnover in value during the week, while B-category issues accounted for 1.78 per cent, N-category 8.09 per cent and Z-category 2.54 per cent.