Stocks rebound riding on small-cap issues

Dhaka,  Sat,  19 August 2017
Published : 09 Jul 2017, 22:00:54
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Stocks rebound riding on small-cap issues

Stocks rebound riding on small-cap issues
FE Report


Stocks bounced back Sunday, after facing marginal correction in the previous session, as optimistic investors took position on sector specific stocks.

Brokers said following the previous session's profit taking correction, the market staged a comeback, rallying with rising turnover and institutional participation seemingly boosted the market.

They said fresh fund injection by the institutional investors seemed helped the market to win back its rhythm while participation of retail investors also increased amid optimism.

"Revision of budget coupled with optimism of June closing year-end earnings and dividend declarations continued to prompt investors to inject fresh funds into stocks, taking the market turnover further hike," said an analyst at a leading brokerage firm.

However, top 10 gainers chart dominated by small-cap companies with Peninsula Chittagong was the highest gainer of 8.58 per cent.

The market started with a positive note and the upward trend continued till end of the session amid modest volatility, finally ended more than 24 points higher.

DSEX, the prime index of the Dhaka Stock Exchange (DSE), went up by 24.64 points or 0.43 per cent to settle at 5,774, over the previous session.

IDLC Investment, a merchant bank, said, "The market returned in the gaining trajectory just after one-session of decline. DSEX netted a gain on 24.6 points, riding on smaller capitalisation stocks".

The merchant bank noted that large-cap issues were pale on the day, with majority of large-cap issues facing decline.

Textile sector played a vital role in the market, leading it both in terms of gain of 1.8 per cent and market share of 22 per cent of total turnover, among the major sectors.

"Textile issues witnessed some fresh buy as government has decided to reduce the tax at source on RMG export," said a stockbroker.

The two other indices also closed marginally higher. The DS30, comprising blue chips, advanced 4.70 points or 0.22 per cent to close at 2,108. The DSE Shariah Index (DSES) gained 7.10 points or 0.54 per cent to finish at 1,314.

The turnover, an important indicator of the market, remained encouraging and total turnover stood at Tk 11.60 billion on the DSE, which was 15 per cent higher than the previous day's mark of Tk 10.05 billion.

Textile sector kept its dominance in turnover chart for the eight running sessions, capturing more than 22 per cent of the day's total transaction, followed by pharmaceuticals 15 per cent and fuel & power 11 per cent.

International Leasing Securities, said, "The session started with upbeat vibe and continued till the closure as the enthusiastic investors back to the trading floor based on the news of soaring net portfolio investment in stocks in the fiscal year 2016-17 compared to the previous fiscal".

The stockbroker noted that several issues from textile, engineering, cement and pharma sectors supported to the upswing of indices whereas telecom, food and financial institution sectors observed selling pressure.

Large-cap sectors showed mixed performance. Textile posted the highest gain of 1.80 per cent, followed by engineering with 1.13 per cent, pharmaceuticals 0.64 per cent, and power 0.39 per cent.

The port city bourse, the Chittagong Stock Exchange (CSE), also returned to higher with its Selective Categories Index - CSCX - advancing 43 points to settle at 10,819.

Gainers beat losers as 1147 issues closed higher, 77 closed higher and 29 remained unchanged on the CSE.

The port city bourse traded 35.79 million shares and mutual fund units' worth Tk 858 million in turnover.

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