DSEX edges up as bargain hunting offsets energy crisis jitters
Bargain hunting helped the market recover, while energy concerns kept investors cautious.
The country's premier bourse ended a volatile week with marginal gains as a mid-week surge in bargain hunting successfully offset heavy selling pressure seen in the early sessions.
The benchmark DSEX index of the Dhaka Stock Exchange (DSE) inched up by 6 points, or 0.11%, to settle the week at 5,662 points.
Despite the fragile recovery, the market witnessed a "tug-of-war" between opportunistic buyers and cautious sellers. The blue-chip DS30 index followed the broad index's lead, gaining 5 points to close at 2,140. However, the DSE SME Index faced a setback, dropping 26 points to settle at 1,046.
Market participation saw a slight improvement, with the daily average turnover rising by 6% to stand at Tk608 crore.
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EBL Securities, in its weekly market review, said the market came under heavy selling pressure at the beginning of the week amid concerns that persistent domestic headwinds could hurt corporate earnings. The absence of fresh positive catalysts also pushed the DSEX below the 5,600 mark after around two months.
The market, however, received some respite in the middle of the week as bargain hunters accumulated beaten-down shares following favourable remarks from regulatory authorities regarding long-term structural reforms. The recovery attempt lost momentum in the final session as weak conviction over the market's direction triggered quick profit-taking.
Sheltech Brokerage Limited said market performance was largely shaped by the competing forces of buying interest and selling pressure. Optimism surrounding BSEC Chairman Masud Khan's recently proposed market-development initiatives supported buying, while concerns over the energy-supply crisis kept investors cautious.
The brokerage said renewed buying emerged after the BSEC chairman announced several market-development initiatives, but persistent selling pressure kept the market volatile. Going forward, progress on the proposed reforms, developments in the energy-supply situation, and upcoming earnings and dividend announcements from June-closing companies are likely to influence market direction.
Textile stocks dominated trading, accounting for 33.6% of total turnover, followed by general insurance at 12% and pharmaceuticals at 11.3%.
Sector performance was mixed. General insurance led the gainers with a 2.7% rise, followed by travel and jute, each gaining 1.4%. Services was the biggest loser, declining 2.1%.
Beximco Pharma, Malek Spinning, Paramount Textile, Beacon Pharma and Saiham Cotton were among the major stocks supporting the DSEX during the week.
Saiham Textile, Sharp Industries, Malek Spinning, Saiham Cotton and IPDC Finance recorded the highest average turnover.
Saiham Cotton led weekly gainers, rising 15.9%, followed by Nahee Aluminum at 11.1% and Bangladesh National Insurance at 10.5%. Safko Spinning gained 10.5%, while Nitol Insurance advanced 9.6%.
On the other hand, Sharp Industries suffered the steepest decline, falling 20.6%. Lovello Ice-cream dropped 15.7%, Apex Spinning declined 13.6%, Reliance Insurance Mutual Fund One fell 11.5%, and Tung Hai Knitting lost 10.6%.
