Blue-chip profit-taking drags DSEX lower for second consecutive day

The benchmark index of the Dhaka Stock Exchange (DSE) extended its correction for a second consecutive session today (8 July) as investors continued to book profits in blue-chip stocks following their recent gains.

While selective buying interest in low-cap and momentum-driven stocks provided some support, it was insufficient to offset the selling pressure in heavyweight counters, leaving the market in negative territory at the close of the day, according to market insiders.

The broad DSEX index shed 11 points, or 0.19%, to settle the session at 5,770. The downturn was also evident in the blue-chip segment, where the DS30 index slipped by 12 points to finish at 2,169. 

Market breadth remained skewed toward the bears, as 192 issues declined compared to 145 that managed to advance, while 56 scrips remained unchanged on the DSE floor.

According to the daily market review by EBL Securities, the indices opened under pressure as profit-taking weighed on investor sentiment from the outset. Although buying interest picked up in the second half of the session, largely driven by demand for attractively valued small-cap stocks, persistent selling in heavyweight constituents kept the benchmark index in the red.

The market's volatility underscores investors' cautious approach as they assess whether the recent rally can be sustained.

Market participation saw a notable contraction, with daily turnover on the DSE dropping by 17% to stand at Tk1,156 crore, compared to the previous session's volume. 

On the sectoral front, the textile sector dominated trading activity, accounting for 21% of the day's total turnover. This was followed by general insurance at 9.6% and the engineering sector at 8.8%.

In terms of sectoral returns, the travel and leisure sector emerged as the top performer with a 2.8% gain, followed by information technology and textiles. 

On the flip side, the financial institutions sector faced the steepest correction of 1.3%, while the cement and banking sectors also recorded notable price dips, acting as the primary drags on the index.

Individual stock performance was highlighted by Sea Pearl Beach Resort, which topped the gainers' list with a 10% price surge. Other significant gainers included Genex Infosys, Emerald Oil, and Sharp Industries. 

On the losing end, Intech Limited hit the lower circuit breaker, shedding 9.77% of its value, while Fareast Finance and Familytex also featured among the top losers. 

In terms of liquidity, Malek Spinning emerged as the most traded stock, followed by BRAC Bank, Sea Pearl Beach Resort, and IPDC Finance.

The bearish sentiment was mirrored at the Chittagong Stock Exchange (CSE), where the Selective Categories' Index (CSCX) fell by 33 points to finish at 9,481. The broad CASPI index at the port city bourse ended 47 points lower at 15,485. 

Turnover at the CSE also witnessed a decline of 13%, settling at Tk26.89 crore.