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Stocks end flat on sale pressure, economic tensions

Staff Correspondent
13 May 2023 00:00:00 | Update: 13 May 2023 00:28:54
Stocks end flat on sale pressure, economic tensions

Dhaka stocks witnessed a volatile week, with jittery investors going for massive profit booking, while optimistic investors taking fresh bets in particular stocks, especially large-cap shares.

But the key index of the prime bourse this week ended flat, as cautious investors remained on the sidelines after securing short-term gains in fear of further macroeconomic strains, analysts said.

Meanwhile, some media, citing the finance ministry, carried news reports that the government was now contemplating removing tax rebates on investments made in the secondary stock market, exacerbating investors’ sentiment.

Currently, taxpayers are eligible for a 15 per cent rebate on their investments up to a maximum of 20 per cent of their taxable income in the stock market.

The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), added 3.3 points, or 0.1%, to settle at 6,272 at the end of the week. Turnover, another crucial market indicator, averaged out at Tk 791 crore this week, which was 1.4 per cent lower than the average turnover of Tk 802 crore in the previous week.

Investors were mostly concentrated on the IT sector, with the sector topping the turnover chart with a contribution of 14.1 per cent of the total turnover of the DSE, followed by the food and allied (13.0 per cent), and pharma (9.4 per cent).

Sectors ended mixed this week, with the textile posting the highest gain of 1.7 per cent, while the travel sector suffered the most with a correction of 10.8 per cent this week, according to EBL Securities, a stockbroker.

The market remained volatile throughout the week due to the profit booking tendency in some of the recently rallied stocks amid macroeconomic concerns creating uncertainty about the market momentum, the stockbroker said in its weekly market review. The market performed five sessions this week, with the market starting the week on a flat note on Sunday.

It turned negative on Monday with a correction of 0.12 per cent. The market, however, recovered on Tuesday with a rise of 0.19 per cent, and secured a 0.09 per cent gain on the following session on Wednesday.

Finally, the market closed lower with a correction of 0.11 per cent on Thursday.

Financial sectors posted mixed performance this week, with the general insurance booking the the highest gain of 1.23 per cent, followed by bank (0.89 per cent), and NBFI (+0.03 per cent), according Brac EPL, another stockbroker.

On the other hand, the life insurance experienced the highest loss of 1.39 per cent, it added.