Stocks tumble for 2nd day, but companies post good earnings
Amid sell pressures for profit booking, DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), on Tuesday declined 0.43% or 31.58 points to close at 7,313
Good earnings of companies could not stop selling pressure in the stock market, causing indices of both stock exchanges to plunge for the second consecutive day.
Amid sell pressures for profit booking, DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), on Tuesday declined 0.43% or 31.58 points to close at 7,313.
The blue-chip index DS30 fell by 0.26% to 2,749 and the Shariah index DSES gave up 0.35% to 1,591.
Meanwhile, the post city bourse, Chittagong Stock exchange's All Share Price Index (CASPI) dropped 128 points to close 21,360.
But in recent times, some companies have declared their annual earnings disclosure and recommended dividends. Walton, Maksons Spinning, Sonali Paper and others reported good earnings and declared handsome dividends.
Some analysts said the country's stock market is following the adage "buy the rumor, sell the news", which is the tendency for traders to push up a stock's price on rumors or expectations and then sell once that news has been released, even if the news is positive.
EBL Securities said in its daily market review, investors trimmed their position in sector outperformers and favored selling shares that have reached their peak. However, as the earnings disclosure of listed companies is expected to be higher this year, bargain hunter investors will opt to take positions in the dividend-paying companies.
The total turnover of DSE slightly advanced and stood at Tk1,863 crore, compared with the previous trading day. Out of the 375 issues traded, 93 advanced, 244 declined, and 38 remained unchanged.
Heavyweight stocks, such as Beximco, LafargeHolcim, and Robi, dragged the index on Tuesday.
On the sectoral front, pharma stocks were the most traded and they contributed 18.36% to the day's total turnover, followed by textile (11.30%) and fuel and power (10.57%).
Most of the sectors observed declining performance, out of which tannery (1.7%), general insurance (0.6%), and pharmaceuticals (0.4%) have exerted the most positive returns, while services (-3.9%), cement (-3.2%), and non-banking financial institution (-2.7%) observed the most corrections on Tuesday.
NRBC Bank topped the gainer list with a 9.7% increase followed by ICB Islamic Bank at 7.7% and Kattoli Textile at 7.6%.
On the other hand, Tamijuddin Textile performed the worst, which lost 7.5%, followed by Envoy Textile (6.6%) and Tallu Spinning (6.2%).
