DSEX rebounds to 5,000 mark as investor confidence grows

Infographics: TBS

The indices of the Dhaka Stock Exchange (DSE) extended their positive momentum for the fifth consecutive session, as cautious investors remained active on both the buying and selling sides despite concerns over potential US tariffs.

Today (9 July), the DSE's key index crossed the 5,000 mark for the first time in two and a half months, while daily turnover reached its highest level in eight months by the end of the trading session.

Over the five-day rally, the DSE's benchmark index gained a total of 201 points, helping to restore investor confidence and draw participants back to the trading floor.

On the day, the DSEX increased by 54 points to close at 5,035. The DSE Shariah Index (DSES) rose by 10 points to 1,094, while the blue-chip index DS30 advanced by 19 points to settle at 1,894.

Turnover on the DSE surged by 14.78% to Tk691 crore, compared to Tk602 crore in the previous session. Of the 397 issues traded, 273 advanced, 78 declined, and 46 remained unchanged.

Market insiders said that the ongoing five-day rally has rekindled investors' interest in the trading floor. They believe that political uncertainty is beginning to ease, key macroeconomic indicators are turning positive, and the yields on government securities are starting to decline. As a result, investors are showing renewed interest in undervalued but fundamentally strong stocks.

Akramul Alam, Head of Research at Royal Capital, told The Business Standard (TBS) that the current uptrend may continue for a few more days. One of the key reasons, he said, is the falling yield on government securities, which is expected to decline further.

He also noted that concerns over falling foreign exchange reserves have eased, as reserves have stabilised and are gradually increasing. Moreover, the government's initiative to merge weak banks has had a positive impact on the market.

Alam added that political uncertainty surrounding the upcoming election has lessened. Additionally, many listed companies' shares remain undervalued, and investors are hopeful about the performance of companies that follow the June-closing fiscal year. Overall, he said, investor sentiment has turned positive.

Md Saifuddin, Managing Director of IDLC Securities, also expressed optimism about the market's direction. He cited the stability in foreign reserves and steady remittance inflows as major contributing factors.

He said the country's economic indicators are now in a better position than before, and there is also a sense of political calm. Furthermore, investors now have a clearer understanding of ongoing capital market reforms, which is boosting confidence.

In its daily market commentary, EBL Securities noted that the DSE's benchmark index extended its winning streak for the sixth straight session, surpassing the 5,000-point mark after 2.5 months, driven by buoyant investor sentiment.

"The bulls continued to dominate the market, defying concerns over the US's proposed higher tariffs on Bangladeshi exports," the commentary said.

It added that the market experienced buy-side dominance throughout the session, as investors took positions in equities on positive expectations, seeing most stocks as attractively valued.

In terms of sectoral performance, the banking sector recorded the highest turnover at 16.9%, followed by pharmaceuticals at 12.7%, and the food sector at 9.6%.

All major sectors ended in the green. Among them, the life insurance sector posted the highest gain of 4.3%, followed by the ceramic (2.9%) and travel (2.8%) sectors.

The port city bourse, Chittagong Stock Exchange (CSE), also had a positive trading session. The Selective Categories Index (CSCX) rose by 74.1 points, while the All Share Price Index (CASPI) gained 130.0 points.