Dhaka stocks rebound after week-long correction
In the last seven sessions, the benchmark index of the Dhaka Stock Exchange, DSEX, dropped 222 points, as profit-taking investors shifted funds into undervalued and promising stocks.
Dhaka stocks rebounded strongly today (14 August) after seven consecutive sessions of decline, as cautious investors engaged in both buying and selling, helping the market recover from a prolonged correction.
In the last seven sessions, the benchmark index of the Dhaka Stock Exchange, DSEX, dropped 222 points, as profit-taking investors shifted funds into undervalued and promising stocks.
Today, the DSEX gained 36 points to settle at 5,350. The blue-chip DS30 index gained 17 points to close at 2,074, while the Shariah index increased 7 points to finish at 1,163.
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Turnover inched down by 0.28% to Tk703 crore, from Tk705 crore in the previous session. Of the 399 issues traded, 168 advanced, 154 declined, and 77 remained unchanged.
Major blue-chip stocks contributing to the DS30's positive movement included Investment Corporation of Bangladesh, LafargeHolcim Bangladesh, Robi Axiata, Beacon Pharmaceuticals, Beximco Pharmaceuticals, Walton Hi-Tech Industries, United Power Generation and Distribution Company, British American Tobacco Bangladesh Company, Summit Power, and Southeast Bank.
Market insiders expect the current trend to continue through this week. Cautious investors are actively restructuring portfolios and adjusting investment plans amid profit-taking and the ongoing correction phase.
A key factor supporting equities is the declining yield on government securities, which analysts anticipate will fall further. With stock market returns currently exceeding 10%, lower government bond yields are making equities more attractive to investors.
Investor confidence has also been strengthened by several positive macroeconomic developments.
Bangladesh's foreign exchange reserves have stabilised and begun to rise, easing earlier concerns. The government's plan to merge weaker banks has reassured the market, while political uncertainty ahead of the upcoming national election has diminished, removing a significant drag on sentiment.
Additionally, many listed companies – particularly those with a June-ending fiscal year – remain undervalued, attracting renewed buying interest.
Overall, insiders say the market's resilience is being driven by easing economic worries, supportive policy actions, and attractive valuations, creating conditions where equities are becoming increasingly hard to ignore.
Among the top gainers were Hwa Well Textiles (BD), Wata Chemicals, GQ Ball Pen Industries, Southeast Bank, and Summit Power.
On the other hand, top decliners included SEML FBLSL Growth Fund, Green Delta Mutual Fund, Vanguard AML Rupali Bank Balanced Fund, Zahintex Industries, and Maksons Spinning Mills.
Most large-cap sectors closed higher today. The non-bank financial institutions (NBFI) sector recorded the biggest gain of 3.44%, followed by banks 0.96%, pharmaceuticals 0.80%, food and allied 0.53%, fuel and power 0.52%, and engineering 0.50%.
In contrast, the telecommunication sector declined by 2.18%. Block trades accounted for 2.1% of the day's total market turnover.
The port city bourse, Chittagong Stock Exchange (CSE), also rebounded in a green session today. The Selective Categories' Index (CSCX) and All Share Price Index (CASPI) edged up by 33 and 47 points, respectively.
