Banking stocks lead market recovery in broad-based DSE rally

Stocks rebounded strongly today (7 January) as renewed buying in large-cap shares pushed the Dhaka Stock Exchange's benchmark index close to the 5,000-point threshold, offsetting lingering concerns over weak financial institutions. 

The DSEX rose 39 points to close at 4,992, marking a broad-based rally with most sectors ending in positive territory. The advance helped the market claw back part of its recent losses, as investors selectively accumulated fundamentally sound stocks. The blue-chip DS30 index added 17 points to finish at 1,913, driven mainly by gains in banking, telecommunications and pharmaceuticals.

Market breadth was positive, with 193 stocks advancing against 131 decliners, while 64 issues remained unchanged. Turnover inched up to Tk465 crore, suggesting cautious but gradually improving investor participation following recent volatility. Market participants said renewed interest in large-cap and dividend-paying stocks lifted overall sentiment, particularly in the banking sector, which posted the day's strongest performance. Banking shares rose an average of 1.83% on bargain hunting after recent corrections. Telecommunications advanced 0.80%, engineering stocks gained 0.56%, and food and allied companies added 0.49%.

Trading remained concentrated in a limited number of active counters. Orion Infusion led the turnover chart, followed by City Bank, Square Pharmaceuticals, Uttara Bank and Malek Spinning, reflecting strong interest in both financial and manufacturing stocks. Several loss-making companies featured prominently among the top gainers as speculative buying drove sharp price increases. Zeal Bangla Sugar surged nearly 10%, while Shyampur Sugar and Familytex also posted strong gains. Regent Textile jumped more than 8%, underscoring continued risk-taking by a segment of retail investors despite weak fundamentals.

In contrast, troubled non-bank financial institutions faced heavy selling pressure and dominated the list of top losers. International Leasing and Fareast Finance both fell by more than 10%, while FAS Finance, Premier Leasing and Prime Finance also recorded steep declines. Market insiders said confidence in these stocks remains severely eroded following recent remarks by the Bangladesh Bank governor on declaring several NBFIs non-viable.

Positive momentum was also evident at the Chittagong Stock Exchange, where both key indices closed higher. The CSCX index rose 76 points to 8,633, while the CASPI index advanced 108 points to settle at 13,975. Turnover at the port city bourse increased to Tk12.80 crore, signalling improved participation.