Stocks witnessed rally for the second consecutive week on buying pressure particularly from institutional investors.
During the week that ended Thursday, the benchmark DSEX soared 94 points or 2.3% to 4,407, which is 7-week high. The blue chip index DS30 rose 50 points or 3.4% to 1,555.
The Chittagong Stock Exchange (CSE) Selective Categories Index, CSCX, gained more than 249 points or 3% to close the week at 8,663. The stock exchange shortened trading session to four days from usual five due to general holiday on Sunday on account of 10th national election.
Volume of trade increased as the daily turnover averaged Tk457 crore, registering a 28% rise over the previous week’s average of Tk357 crore.
“The institutional investors are pouring fresh fund into stocks contributing to consolidate the market with a positive attitude,” said LankaBangla Securities in its weekly market analysis.
Investors seem to be highly optimistic about market direction ahead as the investors are expecting the new government to take popular decisions that would boost economic activities, it said.
The government has reduced source tax in ready market garment (RMG) sector from 0.8% to 0.3% to boost the largest export earning sector as they are badly hit by recent political clashes, it said.
The central bank’s consideration of expansionary and balanced monetary policy statement for second half of fiscal year 2013-14 is the most important trigger point for capital market, it said, adding that the market makers are anticipating monetary easing to boost up economic activities. However, it said real investment from entrepreneurs is still low due to continuous political clashes.
Zenith Investments said investors may still be cautious about the political stance, however, they also seem enthusiastic to indulge themselves in the market thus boosting support level and helping the market in making its ground stronger.
IDLC Investment said hope for a breathing space in political frontier influenced the week positively. “Announcement of new incentives to textile sector assisted it to break out of its losing streak. In the mean time, expectations regarding upcoming monetary policy statement seemed to have come into play from the final session, influencing banks positively.”
During the week, gainers took a strong lead over the losers on DSE as out of 297 issues traded in the past week, 218 advanced, 56 declined and 23 remained unchanged.
All the major sectors ended in green except banks which lost 0.2% in the past week. Engineering was the biggest winning sector that gained more than 5%, driven by National Tubes that surged over 20% following its positive earnings.
Among other well performing sectors, pharmaceuticals, fuel & power, non-banking financial institutions and telecommunications were notable.