Stocks end eight-day losing streak with rebound in market sentiment
However, over the previous eight sessions, the DSEX plummeted by 352 points, hitting a low not seen in over three years.
The stock market staged a turnaround on Wednesday (20 March), snapping an eight-day losing streak, as investor sentiment rebounded on the back of reform recommendations put forth by the brokers association.
The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), surged by 58 points to reach 5,872, while the blue-chip index DS30 added 12 points, closing at 2,032.
However, over the previous eight sessions, the DSEX plummeted by 352 points, hitting a low not seen in over three years.
EBL Securities said in its daily market commentary, the capital bourse clutched the free fall, with the majority of scrips rebounding from their prolonged losing streak as some opportunist investors came up to take positions on low-priced scrips owing to positive expectations from the brokers association meeting regarding the current state of the stock market.
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But overall market confidence is yet to rebound since there is no major trigger for the market to bounce back from the prolonged bearish sentiment, it added.
The DSE Brokers Association (DBA) held a meeting among the top brokers on 19 March and stated in a press release that they believe the last four weeks' fall is a natural consequence of the withdrawal of floor price restrictions.
They also anticipated that the market would soon take the right course, attracting investors to lucrative stocks at cheaper prices. They urged policymakers and regulators not to consider any radical market interference, such as reinstating floor price restrictions.
Their major demands at the meeting, according to the statement quoting DBA President Md Saiful Islam, included listing more of the well-performing companies to increase the supply of quality stocks, strengthening the mutual fund sector, ensuring reforms in the stock categorisation system and margin loan regulations, and ensuring compliance in listing and operating listed firms.
Wednesday's surge was largely attributed to the rise of fundamentally weak stocks, predominantly influenced by market manipulators. Consequently, non-operating stocks such as Khulna Printing and Packaging, Golden Son, Keya Cosmetic, and Tallu Spinning led the top gainers' table at the DSE.
Despite 305 stocks surging, the DSE's market capitalisation witnessed a decrease of Tk700 crore, settling at Tk6.87 lakh crore. Meanwhile, market turnover decreased by 9% to Tk422 crore as against Tk465 crore in the previous session.
Orion Infusion led the list of top traded shares with a turnover value of Tk21 crore, followed by Fu-Wang Ceramic, Central Pharma, and Golden Son.
The Chittagong Stock Exchange (CSE) also ended in positive territory Wednesday, with its general index CSCX rising by 62 points to reach 10,062, while the all-share price index CASPI gained 106 points to reach 16,760. Additionally, the turnover at the CSE increased by 6% to Tk17.89 crore compared to the previous session.
