Bearish spell swept over stock market for the third week in a row, as poor earnings results that poured in the market accelerated selling pressure.
During the week ended Thursday, the benchmark DSEX lost 138 points or 3% to close the week at 4,417, slipping to five-month low since January 9, 2014. The blue chip index DS30, however, shed 61 points or 4% to 1,604.
The DSE Shariah Index was down 28 points or almost 3% to 985. The Chittagong Stock Exchange (CSE) Selective Categories Index, CSCX, fell 254 points or 3% to 8,509.
Trading continued to remain sluggish as the daily average turnover of the week stood at Tk364 crore, registering a drop of 5% over the previous week’s average of Tk383 crore.
The market witnessed four instead of usual five trading sessions in the past week, as the market was closed Tuesday due to public holiday on the occasion of Buddha Purnima.
All the major sectors closed in red during the week, food and allied was the biggest loser of the week with 5% loss, followed by pharmaceuticals 4%, non-banking financial institutions 4%, telecommunications 2.9% and energy 2.5%.
“Investor sentiment seems to be highly bearish. Poor first quarter performance by listed companies and banks’ reduction of capital market exposure is getting heavier on market,” said Lanka Bangla Securities, in its weekly market analysis.
The High Court on Wednesday scrapped the provision imposed by the securities regulator for individual sponsor-directors to always hold at least 2% shares in listed companies. “Investors might have taken this negatively,” it said.
However, the Appellate Division on Thursday stayed the order till May 22.
IDLC Investments said investment-hostile economic and political state of the country strangled movements in the capital market, forcing investors to rethink their exposure.
It said mixed quarterly earnings and corporate declaration kept investors nervous throughout this week.
“Investors’ confidence has been hit as any definite stock-wise or sector-wise trend failed to emerge in the market. Especially, financial sector behaved erratically, reflecting investors’ underweighting of accounting numbers in recent investment decision making,” said the merchant bank.
IDLC said forward looking participants remained on the sidelines, considering over budgetary incentives to the market, resulting in sluggish turnover.
In the past week, two companies – Hwa Well Textiles and Wata Chemicals – began trading in the stock market.
Losers took a strong lead over the gainers as out of 303 issues traded during the week, 220 declined, 67 advanced and 16 issues remained unchanged on the DSE.
Grameenphone dominated the week’s top turnover chart with shares worth Tk67 crore changing hands, followed by Matin Spinning, Square Pharma, Lafarge Surma Cement and Hwa Well Textiles.
