Stocks rebound amid bargain hunting, turnover falls

Dhaka and Chattogram stocks started the new month with gains as investors, in an effort to take advantage of the previous two days' fall, pushed the major indices up on Tuesday.

The DSEX, the broad-based index of the Dhaka Stock Exchange (DSE), closed 0.22% higher at 6,339, more than recovering its previous day's losses.

However, turnover fell further to below Tk600 crore due to the cautious approach of investors.

"Bargain hunters favoured taking positions in lucrative issues taking advantage of the recent corrections," EBL Securities wrote in its daily market commentary.

The upbeat momentum in the market sustained throughout the session since buy dominance prevailed across the bourse as investors sought quick-gain opportunities in sector-specific issues, it added.

However, investors were yet to regain confidence across the trading floor because of market uncertainties due to the potential resurgence of political movements ahead of the national election, according to the analysts at the brokerage firm.

Also, many cautious investors were still on the sidelines as they preferred to observe the market momentum and the corporate earnings disclosures by the listed firms. The overall economic environment amid a rising interest rate trend was also a reason behind investors' caution.

Investors' participation in trading decreased as total turnover fell by 17.9% to Tk546 crore in the DSE. Also, the port city bourse Chittagong Stock Exchange saw a 19% decline in daily turnover that fell to Tk8.7 crore.

Stockbrokers said, price of many stocks had been in a declining trend over the recent weeks. And after a considerable correction, the stocks saw a higher demand as investors started to buy them from the oversold zone before the closing bell on Tuesday.

On the sectoral front, general insurance, food, and miscellaneous together made half of the daily turnover in the DSE.

Most of the sectors displayed positive returns. Jute, IT, and general insurance sectors advanced, while travel, services, and ceramic sectors led the losers.

110 scrips advanced and 60 declined in the DSE.

Green Delta Insurance, Emerald Oil, People's Insurance, Sinobangla, Western Marine Shipyard, Aziz Pipes, Legacy Footwear, Sonali Life Insurance, Deshbandhu Polymer, and Beach Hatchery were the top ten gainers in the DSE.

On the other hand, C & A Textiles, Rupali Bank, Mercantile Insurance, RSRM Steel, Union Insurance, Crystal Insurance, Dhaka Insurance, Islami Insurance, and Chartered Life Insurance dominated the losers' table.

At the end of one year of the floor price mechanism which the regulator imposed at the end of July last year, 224 of the 401 DSE scrips were stuck on the floor prices during the closing bell on Tuesday.