Stocks face major correction with low turnover

Dhaka,  Mon,  29 May 2017
Published : 14 Apr 2017, 17:27:54 | Updated : 14 Apr 2017, 17:35:21
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Weekly sharemarket review

Stocks face major correction with low turnover

Stocks face major correction with low turnover
FE Online Report
Stocks faced major correction last week that ended on Thursday, after single-week break, as risk-averse investors released their holdings throughout the week to avoid further loss.

Analysts said the market fell as selling pressure intensified on continuous fall of almost all the large-cap stocks like Grameenphone, Square Pharma, BRAC Bank, Islami Bank, Beximco Pharma, City Bank and BSRM Steel.

The week featured five trading sessions as usual and all five sessions closed lower amid thin participation from the investors.

Week-on-week, DSEX, the prime index of the Dhaka Stock Exchange (DSE), went down by 90.54 points or 1.58 per cent to settle the week at 5,646.

International Leasing Securities, a stockbroker, said, “The shaky investors opted to liquidate their holding of shares to escape from further losses while some adopted “wait-and-see” approach amid ongoing market movement”.

The stockbroker noted that several issues from textile, IT and food sector enjoyed buoyancy, however, selling of shares was observed mostly from bank, engineering and financial institution sectors.

LankaBangla Securities, a stockbroker, said, “All of the trading days of the week closed red”.

The stockbroker noted that price fall of large-cap stocks is responsible for this huge drop in index. Among the top 20 large cap stocks, all except two stocks experienced major price fell last week.

The two other indices also closed lower.

The DS30 index, comprising blue chips, saw a sharp loss of 46.86 points or 2.20 per cent to finish at 2,087.

The DSE Shariah Index fell 17.83 points or 1.36 per cent to close at 1,295.

The port city bourse, Chittagong Stock Exchange (CSE), also closed lower with its Selective Categories Index, CSCX, losing 194 points or 1.79 per cent to close at 10,593.

Sheltech Brokerage said, “Sell-off in large-cap tumbled the DSEX from the beginning of the week and ended red in every session due to lack of confidence among investors”.

The total turnover for the week stood at Tk 36 billion against Tk 48 billion the week before.

The daily turnover averaged at Tk 7.18 billion, which was 25 per cent lower than the previous week’s average of Tk 9.58 billion.

The bank sector kept its dominance in turnover chart for the third straight week, capturing 21 per cent of the day’s total turnover value, followed by textile 17 per cent and financial institutions 13 per cent.

City Bank Capital Resources, a merchant bank, said, “The bearish sentiment reflected on turnover activity as the weekly total turnover fell sharply”.

The losers took a strong lead over the gainers as out of 332 issues traded, 201 closed lower, 100 closed higher and 31 remained unchanged on the DSE trading floor.

The total market capitalisation of the DSE also fell 1.05 per cent last week as it was Tk 3,823 billion on the opening day of the week, while it came down to Tk 3,783 billion on closing day of the week.

LankaBangla Finance dominated the week’s turnover chart with about 26.60 million shares of Tk 1.68 billion changing hands, followed by IDLC Finance, Ratanpur Steel, City Bank and Brac Bank.

Regent Textile Mills was the week’s biggest gainer, posting a 33.73 per cent gain, while Brac Bank was the worst loser, slumping by 18.83 per cent following its price adjustment after record date.

 
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