DSEX stays resilient despite Trump's tariff blow on Bangladesh

Infographics: TBS

The benchmark index, DSEX, of the Dhaka Stock Exchange (DSE) remained resilient today despite US President Donald Trump's imposition of a 35% reciprocal tariff on Bangladeshi products, which will be effective from 1 August.

The index rose by 5.47 points to close at 4,981, extending its gaining streak to the fourth consecutive session. Meanwhile, the blue-chip DS30 index added 2.38 points, settling at 1,875.

Among the traded securities, 158 advanced, 191 declined, and 49 remained unchanged.

Turnover, a key indicator of market activity, climbed to Tk601 crore, marking the highest in over four months, as investor participation increased.

The Chittagong Stock Exchange (CSE) also ended on the green terrain as its all-share price index CASPI rose by 17 points and the general index CSCX gained 16 points.

EBL Securities, in its daily market commentary, said the capital market exhibited a resilient comeback to close in the green, shrugging off three sharp dips into the red sparked by jitters over a proposed tariff on Bangladeshi exports.

The market experienced heightened volatility throughout the session, with bearish sentiment triggered by concerns over the US tariff move attempting to overshadow the bullish momentum triggered by positive macroeconomic developments, such as improved forex reserves and easing inflation, it added.

EBL Securities further said that despite profit-taking pressure in large-cap stocks, particularly in the banking sector, the market held firm and closed in positive territory with increased investor participation.

Akramul Alam, head of Research at Royal Capital, told TBS, "There is still room for negotiation in Trump's tariff announcement. Our government has also stated that the decision on the tariff is not final. There is scope to reduce it through dialogue, and the government has informed that a high-level team is already working on the issue."

He added that the government's response has sparked optimism among investors.

Echoing Alam, SM Galibur Rahman, head of research and strategic planning of Shanta Securities, said, "Investors reacted negatively at the initial trading hours as the USA reciprocal tariff news came. However, we think the Bangladesh government still has one month for negotiations. A good proposal to the US (like Vietnam 0% tax) can make the US president lower or withdraw the tariff fully. We believe that's why the market recovered later."

Alam further said, "Many stocks in the current market are being traded at discounted prices. Smart investors are taking advantage of this opportunity, which has helped the market absorb the selling pressure."

He went on to say, "Additionally, a stable currency market and growing foreign exchange reserves are boosting investor confidence. At the same time, the declining interest rate on treasury bonds is also contributing to a more positive market sentiment."

On the sectoral front, the bank issues exerted the highest turnover, followed by the pharma and textile sectors. 

Sectors demonstrated mixed results, out of which the paper, travel and life insurance exhibited the most positive returns while mutual fund, non-bank financial institutions, and services showed the most negative returns on the day.

Asiatic Laboratories was the top-traded stock, which was followed by Midland Bank and Sea Pearl Beach Resort.

Rahima Food led the gainers' list as its share price jumped by 9.97% to reach Tk89.9, which was followed by Tamijuddin Textile, which rose by 9.95% to Tk117.1 per share.

On the other end, ICB Third NRB Mutual Fund was the day's top loser, dropping 4.08% to Tk4.8.