Stocks end in red for two weeks in a row
Market insiders say investors cautious about announcing dividends
Stocks at the Dhaka bourse ended in the red for the second consecutive week as selling pressure persisted across most shares.
The week, which ended on 12 September, was marked by volatility, with declining investor participation amid regulatory reforms and ongoing worker unrest.
Market insiders said the dividend declaration season for the 2023-24 fiscal year began in September. However, investors remained cautious about the announcements from listed firms due to unfavourable economic conditions.
The unrest among workers at various factories further deepened investor concerns, causing many to withhold their funds.
Several stockbrokers said investors were adopting a "wait-and-see" approach due to a conflict between the Bangladesh Securities and Exchange Commission (BSEC) and the Dhaka Stock Exchange (DSE) over the appointment of independent directors to the board.
Two of the seven independent directors appointed by the BSEC had already declined to serve, as questions arose regarding the selection process.
In the week, the DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), ended almost flat, declining by 2.13 points to close at 5,726. Average turnover also dropped by 19%, reaching Tk644 crore.
Of the traded stocks, 271 saw price declines, 107 posted gains, and 18 remained unchanged, while 16 stocks were not traded during the week, according to the DSE's weekly report.
The DS30 index fell by around 14 points, settling at 2,100, while the DSE Shariah index rose by 16.87 points to 1,245. By the end of the week, the market's price-to-earnings (P/E) ratio stood at 10.88.
EBL Securities in its weekly market commentary said the benchmark index of the capital bourse ended flat and remained afloat in negative as investors preferred to remain cautious amid the earnings declaration of companies with fiscal years ending in June and ongoing reformations within the regulatory bodies.
"The market initiated the week on a negative note as investors opted to trim their exposures due to dwindling confidence," EBL said.
"However, bargain hunters stepped in to pull up the benchmark index by taking positions on certain scrips after corrections to secure short-term gains, where the formation of a task force to reform the banking sector, marginal decline in inflation and continued strong remittance inflows also worked as positive catalysts to restore the confidence," reads in the commentary.
According to the report, Linde Bangladesh led the top turnover chart with a turnover of Tk34 crore, accounting for 5.28% of total turnover, followed by Olympic Industries with Tk21.75 crore, and IBN Sina with Tk20 crore.
In the gainer's list, National Tea Company, under the Z category, topped with a 52% increase to Tk486.90 per share, followed by Khan Brother PP Woven Bags, which rose 31.60% to Tk166.60, and Northern Jute, up 28.11% to Tk156.30.
On the losing side, Confidence Cement topped the list with an 18.69% decline to Tk68.30 per share, followed by Rupali Life Insurance, which fell 15.38% to Tk101.20, and Khulna Power Company, down 13.92% to Tk16.70.