Profit booking drags indices down in last 2 hours of trade

Illustration: TBS

Indices at the Dhaka Stock Exchange (DSE) inched down on Monday with the key index shedding a good 21 points in the last two hours of the trading session.

Thanks to the massive selling pressure from cautious investors who preferred to book profits, anticipating a tough time ahead because of the ongoing energy crisis.

At the end of Monday's trade, Dhaka bourse's benchmark index DSEX slipped 0.15% to 6,356, compared to the previous trading session. CASPI, the all-share price index of the Chittagong Stock Exchange (CSE), lost 11 points to close at 18,776.

According to the daily market commentary of EBL Securities, the DSEX failed to stay afloat because of the dominant profit-booking sell pressure by investors who opted to realise short-term gains from scrips that rallied recently.

"The market opened higher with opportunist investors' continuous chase for selective lucrative issues with quick gain potential. However, morning optimism failed to sustain owing to the heavy selling pressure starting from mid-session, causing the core index to dip into negative territory," it added.

Market insiders say the country's economy is in crisis owing to the ongoing high inflation and energy shortage. And, the national election, that is knocking at the door, is adding fuel to the investors' worries.

Hence, investors are taking a cautious stance. Most of them are not going for any long-term investment, and now institutional and retail investors are playing the role of day-traders.

Apparently, if the index is up for two straight days, selling pressure is dragging it down on the third trading day.

On Monday, market participation slightly increased and the DSE turnover inched up to Tk1,256.7 crore from the previous session.

Out of the traded issues, 71 advanced, 111 declined and 179 stayed the same on Monday. 209 scrips are trading at floor prices.

According to the market review by Royal Capital Ltd, all sectors, except textile, miscellaneous, engineering, and fuel and power, faced declines.

Life insurance stocks contributed the highest 16.3% to the day's turnover, followed by IT adding 13.4%, and fuel and power adding 12.7%.

Travel, jute, and general insurance faced the highest corrections of 3.6%, 3.5%, and 2.7% respectively. On the other hand, textile, engineering, and fuel sectors gained by 0.4%, 0.3%, and 0.2% in that order.

Lub-rref Bangladesh Limited led the DSE turnover chart on Monday, followed by Meghna Life Insurance and Intraco Refueling.

BD Autocar was the top gainer, followed by Legacy Footwear and Lub-rref. On the other hand, National Tea was the top loser, followed by Northern Jute and Meghna Insurance.