Junk shares keep beating large-cap stocks

Rumor-based low-performing stocks continue to dominate the capital market, while blue-chip stocks have been facing very dismal responses from investors.

Aziz Pipes Ltd, a company which had been out of production in recent years, topped the gainers’ list of the Dhaka Stock Exchange (DSE) on Tuesday with a price gain of 10 per cent, while Unilever Consumer Care Limited, a multinational firm with sound fundamental base, faced the highest correction of 37.5 per cent.

Analysts and market insiders said this is not a fare sign for the country’s stock market because in recent times, many investors were seen rushing towards rumor-based junk stocks, which helped many small-cap issues top the gainers board.

Meanwhile, Dhaka stocks extended their correction mode as cautious investors continued their profit booking sell-frenzy amidst absence of major trigger in the market.

The DSEX, the broad index of the premier bourse, fell 3.8 points to settle at 6,210 against 6,213 in the previous trading session.

Meanwhile, the capital bourse witnessed an increase in participation, with the total DSE turnover rising by 12.2 per cent to Tk 646 crore against Tk 575 crore in the previous session.

The market witnessed a volatile session, with sellers dominating the trading floor as investors opted to secure their short-term gains in the face of ongoing volatility in the market, said EBL Securities, a stockbroker, in its daily market review.

The IT sector topped the turnover chart with a contribution of 17.4 per cent to the total turnover of the DSE, followed by food (17.2 per cent) and textile (8.2 per cent).

Most sectors displayed mixed returns, with the jute posting the highest gain of 4.6 per cent, followed by services (0.9 per cent) and bank (0.2 per cent).

On the other hand, the IT sector faced the highest correction of 1.3 per cent, followed by paper (1.0 per cent) and travel (0.8 per cent). Out of the issues traded, 59 advanced, 67 declined and 266 remained unchanged.

The port city bourse, CSE, also settled on red terrain, with its two major indices –the selected indices (CSCX), and the all-share price index (CASPI) – declined by 7.0 points and 11.0 points respectively.