2020-03-28 12:03:42 BdST
Weekly review: Stocks snap four-week losses on regulatory move
Stocks edged up in the outgoing week, snapping a four-week free-fall, thanks to regulatory move to boost the ailing capital market.
DSEX, the key index of the Dhaka Stock Exchange, went up by 33.32 points or 0.84 per cent to settle at 4,008.
The presence of investors was thin on the trading floor throughout the week due to the rising number of Covid-19 cases in the country.
The trading and official activities on the bourses to remain shut until April 4 in line with the government holiday, including weekends.
Earlier in the four straight weeks, the core index lost 758 points, wiping out market capitalisation of Tk 485 billion as the pandemic wreaked havoc on stocks.
To curb the free-fall, the Bangladesh Securities and Exchange Commission on March 19 fixed the floor price of stocks by calculating the previous five days' average prices.
Under the new system, price of no security will be allowed to hit below its average closing price of five preceding days.
The bourses also cut an hour trading time from March 22 due to free-fall of stock prices.
The outgoing week saw four trading days as the market remained closed Thursday due to Independence Day. Of them, two sessions edged lower and two ended higher.
Market analysts said the market was saved from the massive fall due to the regulatory measure, but growing tension over the impacts of coronavirus outbreak affect the investors' sentiment.
The latest figures show four more people tested positive with Covid-19, taking the number of the confirmed cases of the pandemic to 48 in Bangladesh, according Institute of Epidemiology, Disease Control and Research (IEDCR).
Eleven people of out 48, who tested positive, were released from hospitals and five died from the virus so far as of Friday.
The new virus continued spreading outside China, disrupting global supply chain, export and import activities.
A merchant banker said the outbreak will obviously affect the economy in terms of cost escalation, demand slowdown, and job losses if the pandemic sustained for a long period.
He noted that the coronavirus is affecting almost all the listed companies due to the shortage of raw materials that come from external sources, including China.
This will hurt earnings of the companies, he added.
Many investors were not able to sell shares during the week amid lack of buyers, said an analyst.
The noted that the market is currently artificially locked at certain index level which left most investors on the sideline.
Two other indices also edged higher. The DS30 index, comprising blue chips, advanced 5.02 points to finish at 1,330 and the DSE Shariah Index gained 1.25 points to close at 920.
The weekly total turnover on the DSE stood at Tk 8.88 billion, down from Tk 12.58 billion in the week before.
The daily turnover averaged Tk 2.22 billion, down more than 29 per cent from the previous week's average of Tk 3.14 billion.
EBL Securities institutional investors, particularly banks have injected new funds to shore up the stock market.
Among the major sectors, the banking sector posted the highest gain of 3.60 per cent, followed by telecom with 1.40 per cent, food 1.08 per cent, financial institutions 0.60 per cent and pharma 0.50 per cent.
The Chittagong Stock Exchange (CSE) also edged higher with its CSE All Share Price Index - CASPI - gaining 194 points to settle at 11,328 and the Selective Categories Index - CSCX - advancing 113 points to close at 6,859.
Unauthorized use or reproduction of The Finance Today content for commercial purposes is strictly prohibited.