Stocks snap 6-day rally on profit-taking

Dhaka stocks fell on Wednesday, breaking their sixth-day winning streak as investors opted for booking quick profits.

The market succumbed to selling pressure as risk-averse investors came in to book their profit above 6,300 index level.

The government’s decision to reduce the working hours unnerved some investors, leading to the fall of the market, dealers say.

In the end, the benchmark DSEX index was down 36 points or 0.28 per cent to close at 6,316.

Two other indices also closed lower. The blue-chip index DS30 fell 21 points or 0.95 per cent to 2,243 while the DSES index, which represents Shariah-based companies, fell 8 points or 0.58 per cent to 1,379.

Amid shortened trading hours, the bourse witnessed a decrease in participation as the total turnover declined by 23.8 per cent to Tk 1,133 crore over the previous session.

To save electricity, the bourses cut trading hours. The trading began trading at 9:30 am instead of 10 am and closed until 1:50 pm instead of 2:30 pm.

“The equity indices of the Dhaka bourse slid into the red trajectory, breaking the continuous upward momentum from the previous six sessions as investors’ concerns loomed, resulting from the possibility of a sluggish economic output due to the recent austerity measures taken by the government to reduce energy consumption,” said EBL Securities in a note.

“The market had been experiencing a bullish trend for the past six sessions as the Bangladesh Bank made attempts to control the forex instability as well as the government’s announcement to adjust the fuel prices according to the global markets.”

However, the momentum was halted when the government instructed to reduce the working hours of government offices and banks, which exacerbated the concerns of jittery investors, enticing them to offload their holdings and book the profits earned from the recent uptrend of the market, it’s said.

On the sectoral front, Textile (19.7 per cent) issues exerted the highest turnover followed by Pharma (15.3 per cent) and Miscellaneous (8.6 per cent) stocks.

Most of the sectors displayed dismal returns, out of which Jute (-2.1 per cent), Travel (-1.8 per cent) and Miscellaneous (- 1.8 per cent) exerted the most corrections on the bourse today, while Service (1.6 per cent), Financial Institutions (0.9 per cent), and Textile (0.4 per cent) exerted some positive returns.

Out of the 386 issues traded, 71 advanced, 215 declined, and 100 remained unchanged.

The port city bourse, CSE, also settled on green terrain. The selected indices (CSCX) and All Share Price Index (CASPI) inched up by 40.3 and 66.9 points respectively.