Stocks break five-session losing streak

The indices of the Dhaka Stock Exchange (DSE) experienced positive momentum yesterday (29 May), breaking a five-day losing streak. Despite the upbeat mood, turnover fell by 7% to Tk247 crore, down from Tk265 crore in the previous session.

The DSEX edged up by 23 points to close at 4,638. The DSE Shariah Index (DSES) also rose by 3 points, reaching 1,011, while the blue-chip DS30 index gained 21 points to settle at 1,730.

Of the 398 issues traded, 222 advanced, 99 declined, and 77 remained unchanged.

Several blue-chip stocks posted gains, including Grameenphone, British American Tobacco Bangladesh, Robi, Walton Hi-Tech Industries, Investment Corporation of Bangladesh, Square Pharmaceuticals, Berger Paints Bangladesh, Renata, Bangladesh Submarine Cables, and United Power Generation & Distribution Company.

Market insiders have expressed concern that, despite the government's commitment to maintaining a healthy stock market, the current leadership of the Bangladesh Securities and Exchange Commission (BSEC) has failed to restore investor confidence.

They noted that the recent market gain is merely a pause in the ongoing downward trend. According to them, no initiative will effectively regain investor trust unless the BSEC chairman steps down.

They argue that, while the chairman has a background in banking, he lacks the capital market expertise needed to resolve complex issues, leaving major problems unaddressed.

As a result, investor sentiment continues to deteriorate. Reputable, long-term investors have largely withdrawn, leaving the market in the hands of day traders and, at times, manipulators.

Recent regulatory crackdowns on market manipulation have also led to a sharp decline in trading activity in both the primary and secondary markets.

Adding to the challenges, rising gas prices are expected to increase production costs and hurt corporate earnings. Institutional participation remains weak, while retail investors continue to exit, deepening concerns about the market's future stability and overall performance.

Desh Garments topped the list of gainers, followed by SEML Lecture Equity Management Fund, CAPM IBBL Islamic Mutual Fund, SEML FBLSL Growth Fund, British American Tobacco Bangladesh, Investment Corporation of Bangladesh, and Shasha Denims.

Social Islami Bank led the list of losers, followed by Al-Arafah Islami Bank, Desh General Insurance, Tung Hai Knitting, and Export Import (Exim) Bank of Bangladesh.

In its weekly market commentary, EBL Securities noted that the benchmark index of the capital bourse managed to close in positive territory, snapping a six-session losing streak, as bargain hunters showed renewed interest in certain blue-chip scrips they considered to be trading at attractive valuations after steep declines.

Although the market remained subdued until mid-session, buyers gradually strengthened their positions, leading to mild recovery in the majority of scrips after the prolonged downturn. 

However, the continuation of the recovery remains uncertain, as investor sentiment is still weighed down by the absence of any strong stimuli to revive confidence, the commentary said.

On the sectoral front, the banking sector accounted for the highest share of turnover at 20.8%, followed by food at 13.5% and pharmaceuticals at 12.3%.

Most sectors ended the day in the green. The food sector posted the highest gain of 4.0%, followed by telecommunications at 3.4% and financial institutions at 3.0%.

Meanwhile, the Chittagong Stock Exchange (CSE) also closed on a positive note. Both the Selective Categories Index (CSCX) and the All Share Price Index (CASPI) posted gains for the day.