Stocks tumble with higher turnover

Dhaka stocks, following a winning session on Thursday, tumbled on Monday due to a resumed selloff in majority scrips. 

DSEX, the broad-based index of the Dhaka Stock Exchange (DSE), closed 0.18% lower at 6203.92 points.

The first session of the week started a little higher as investors were buying some selective scrips. 

However, a selloff in an increasing number of stocks started to pick up steam in 40 minutes, and this continued to drag the major index down until the closing bell at 1.20pm.

Stockbrokers and analysts observed a general tendency among investors to rebalance their portfolios through selling the stocks with less potential for gains and buying the lucrative ones. 

Shariah Index DSES fell by 0.26%, while an 8.56% rise in Unique Hotel shares helped the blue-chip index DS30 arrest its fall within 0.12%. 

"Also, many investors rushed to participate in the selective junk shares that exerted short-term gaining opportunity," said EBL Securities in its daily market commentary. 

A brokerage CEO told The Business Standard that the market did not react to any fresh negative news on Monday, instead a general perception for less fund inflow into stocks over the month of Ramadan kept investors' shaky. 

In Ramadan, ahead of Eid, consumers and businesses usually need more cash.   

Also, the quarterly closing on 31 March was a factor that worked against the market as the bank, non-bank financial institutions and insurers tend to book profits or losses before the quarterly financial closing. 

Meanwhile, the DSE observed 10.7% higher turnover despite the fact that the trading session has been slashed by an hour for the month of Ramadan.

Starting at the regular opening hour of 10am, the stock market rings the closing bell at 1.20pm in Ramadan, instead of 2.20pm. Investors can execute any trade order at the closing price of the day by the 10-minutes post-closing session. 

Travel and leisure, IT and food sectors together contributed to around 40% of the DSE trade on Monday. 

No sector except for travel and jute managed to withstand the selloff. 

Only 28 scrips advanced, 72 declined in the DSE. During the closing bell, only 96 of the 399 scrips had buyers to be bidding, while 303 were stuck at the floor prices having no buyer. 

Legacy Footwear, Unique Hotel and Resorts, Intech Ltd, Samata Leather, National Feed Mill, Aziz Pipes, BD Autocars, Tosrifa, Rupali Life and Imam Button were the top ten gainers in the DSE. 

Islami Commercial Insurance, Monno Agro and General Machinery, Union Insurance, Sonali Paper, Dhaka Insurance, Meghna PET, Premier Bank, One Bank, Metro Spinning and Sea Pearl Beach Resort were the top losers.