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The Financial Express
Swasti Lankabangla Swasti Lankabangla

Weekly Review: Stocks drift lower, block trade snares 43pc of total turnover

| Updated: June 22, 2020 11:24:44


Weekly Review: Stocks drift lower, block trade snares 43pc of total turnover

Stocks ended lower in the post-budget week as investors found nothing special for the capital market development in the proposed budget.

Week-on-week, DSEX, the key index of the Dhaka Stock Exchange, went down by 6.73 points or 0.17 per cent to settle at 3,960, the first week after the budget announcement.

The DSE core index is hovering between 3,950 and 3,970 points in the past two weeks as most of the sellers find almost no buyers amid worsening situation of the deadly virus and floor price limitation.

"The market remained dull as the pandemic situation is not improving and no positive signal for the capital market is visible in the proposed budget," commented City Capital Resources, in its weekly market analysis.

Market operators said the worsening Covid-19 situation has made the market almost buyer-less as the outbreak is going to put a long-lasting impact on the country's overall economy.

The proposed national budget ignored the interest of the capital market despite the fact that the investors' confidence was shattered by the outbreak of Covid-19 in the country, they said.

Two other indices also ended lower. The DS30 index, comprising blue chips, fell 6.32 points to finish at 1,325 and the DSE Shariah Index lost 1.23 points to settle at 918.

The week's total turnover on the DSE stood at Tk 3.39 billion, down from Tk 3.54 billion in the week before.

The daily turnover averaged only Tk 678 million, which was 4.25 per cent lower than the previous week's average of Tk 708 million.

Block trade contributed 43 per cent to the total weekly turnover as the regulator has reset the lower price limit for stock to be traded on the block board to boost turnover without affecting the broad index.

Stocks like Square Pharma, AB Bank, Bank Asia, Renata and Jamuna Bank dominated the block trade board.

Lack of institutional buyers coupled with the current floor price limitation is preventing many investors from buying and selling shares, brining turnover to a record low, said a merchant banker.

"Under the existing system the buyers have not enough scope to purchase securities at their desired prices," he said.

He noted that investors are keeping their hands off to see how the market behaves after the regulator withdraws the floor price.

Most of the shares remained stuck at the trading floor. Of the traded issues, 285 remained unchanged while only 19 issues advanced and 39 declined on the DSE.

The Chittagong Stock Exchange (CSE) also ended lower with its CSE All Share Price Index - CASPI - losing 13 points to settle at 11,254 and the Selective Categories Index - CSCX -shedding 8.0 points to close at 6,818.

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