Stocks extend winning streak on reform optimism; turnover hits two-year high

Bangladesh's stock market extended its rally today (12 July), the first trading day of the week, as investor optimism over regulatory reforms and the government's commitment to developing the capital market remained strong.

Driven by robust buying pressure, the benchmark DSEX index of the Dhaka Stock Exchange (DSE) gained 45 points to close at 5,849. Daily turnover also crossed the Tk1,600 crore mark for the first time in nearly two years, reaching Tk1,669 crore.

Turnover increased by around 16.9% compared with the previous trading session. Market participants attributed the rise to growing demand for fundamentally strong stocks trading at attractive valuations, alongside expectations of market reforms.

Buying interest was particularly strong in banking and insurance stocks from the opening bell. The blue-chip DS30 index rose 22 points to 2,200, while the DSES, which tracks Shariah-compliant companies, also ended the day in positive territory.

Of the 392 listed companies and mutual funds traded on the DSE, 199 advanced, 156 declined, and 37 remained unchanged.

The Chittagong Stock Exchange (CSE) also maintained its positive momentum. The CSCX index gained 66.8 points, while the broader CASPI index advanced 77.4 points. Strong buying in banks, insurers and other large-cap stocks helped the market close higher.

In its daily market review, brokerage firm EBL Securities said investor confidence, supported by regulatory and political commitments to capital market reforms, generated broad-based buying across sectors.

Although some profit-taking emerged during the session, fresh buying quickly absorbed the selling pressure, allowing the market to retain most of its gains and extend its upward trend, the brokerage said.

According to EBL Securities, the banking sector accounted for the largest share of turnover at 12.8%, followed by textiles (12.6%) and general insurance (12.4%).

In terms of price movement, the general insurance sector was the most active, contributing 16.9% of total traded value, followed by textiles (12.2%) and engineering (8.7%).

The mutual fund sector posted the biggest gain, rising 3.7%. The life insurance index climbed 3.2%, while the jute sector advanced 2.9%.

On the downside, the information technology (IT) sector recorded the steepest decline, falling 1.8%. The miscellaneous sector lost 0.5%, while the travel and leisure sector slipped 0.3%.

Lovello Ice Cream topped the turnover chart, followed by Bangladesh Shipping Corporation, Malek Spinning, Eastern Housing, and ITC.

Among the top gainers, Union Insurance rose 9.82%, followed by Meghna Insurance (9.78%), Sandhani Insurance (9.57%), EBL First Mutual Fund (9.52%), and MBL First Mutual Fund (9.52%).

On the losing side, Apollo Ispat Complex fell 9.37%, matching the decline of Zaheentex Industries. Intech lost 9.31%, Shurwid Industries dropped 8.95%, and AFC Agro Biotech declined 8.86%.

During the trading session, rumours that several long-suspended listed companies might be delisted created temporary volatility in the market.

The Bangladesh Securities and Exchange Commission (BSEC) later dismissed the reports as completely baseless and misleading in a press release.

The regulator clarified it had not taken any decision to immediately delist companies that have remained out of production or commercial operations for a prolonged period.

However, the commission urged investors to exercise extreme caution when investing in companies that have remained inactive for a long time and whose going concern status is under serious threat. It also advised investors not to make investment decisions based on rumours or incomplete information.