Stocks soar after key policy rate hike

Dhaka stocks rose to finish the week in the green on Thursday ignoring the key policy rate hike by the Bangladesh Bank.

The market started the day with a subdued mood as investors refrained from taking risky bets hours ahead of the announcement of the monetary policy statement. However, it jumped in the final minutes due to the strong buying support from the institutional investor, dealers say.

The DSEX, the key index of the Dhaka Stock Exchange (DSE), went up by 26.47 points or 0.41 per cent to settle at 6,376. DSEX added 76 points in the past four days.

The DS30 Index, comprising blue chips, saw a fractional gain of 0.40 points to finish at 2,295 and the DSE Shariah Index (DSES) gained 1.37 points to close at 1,386.

The central bank raised its key interest rate by 50 basis points to 5.50 percent as part of its efforts to control consumer prices.

“Dhaka stocks ended up in the green for four straight sessions, but investor confidence hasn’t yet reached its peak because of worries over the country’s growing Covid cases,” EBL Securities said in a note.

The market is showing signs of reversing the bearish trend, backed by across the bourse buying of investors, as many stocks were traded at lucrative price due to consecutive corrections observed by the indices, it said.

Besides, bourses observed a considerable rise in participation, while turnover has advanced by 16.4 per cent and stood at Tk 937 crore as against Tk 806 crore in the previous session.

On the sectoral front, Textile (15.8 per cent) issues exerted the highest turnover followed by Pharma (13.9 per cent) and Engineering (11.9 per cent) stocks.

Most of the sectors displayed positive returns, out of which Paper (3.7 per cent), Tannery (2 per cent), and Financial Institute (1.7 per cent) generated some positive returns while Miscellaneous (-0.5 per cent), Ceramic (-0.5 per cent) and Services (-0.3 per cent) exerted the most negative returns on the bourse on Thursday .

Out of the 386 issues traded, 195 advanced, 136 declined, and 55 remained unchanged.

The Chittagong Stock Exchange (CSE) also posted a modest rise with the CSE All Share Price Index – CASPI –gaining 37 points to settle at 18,727 point and the Selective Categories Index – CSCX –rising nearly 23 points to close at 11,226 point. Of the issues traded, 146 declined, 115 advanced and 40 issues remained unchanged on the CSE.