Star Business Report
Dhaka stocks edged down last week, as profit-booking sales and a price fall in the telecom sector shadowed the market.
The benchmark index of Dhaka Stock Exchange -- DSE General Index -- fell 36.17 points, or 0.58 percent, to 6,153.68.
Many investors, including institutions, booked profit ahead of the half-yearly closing, putting stress on the overall market.
Besides, a weeklong price fall in the shares of Grameenphone, the lone player in the telecom sector, and reactions to the changes in the margin loan criteria also dulled investor sentiment, BRAC-EPL, an investment bank, said in its weekly analysis.
Grameenphone, the largest stock in the market, continued its slide for an eighth session. The slide started in April, with a short respite around the dates of the company's AGM. GP came down from a lofty Tk 395 to Tk 240, a 65 percent slide.
"GP's pre-IPO placement of shares, which is equal to the size of the current public float, enters into free trading from the fourth quarter of this year after expiry of the lock-in period," the BRAC-EPL said.
"The market seems to have anticipated the selling pressure from institutional investors at that time."
Another major development of last week was the reaction to the changes in the margin lending rules, it said.
On June 20, the Securities and Exchange Commission restricted margin lending on stocks for securities with price-earning ratio over 40.
The market suffered selling pressure in the following two days. Although volumes in the market went up, only sectors with low PE ratios benefited from this change. Financial stocks, including banks and NBFIs, gained both in value and volume, the BRAC-EPL said.
"This seems to be the result of a concerted effort by the government to bring sanity back to the market by adopting various fiscal and regulatory measures."
"If this continues, we can expect speculative stocks coming back to earth and undervalued stocks such as banks and fuel and power gaining at their expense," it added.
Losers beat gainers 149 to 103 with one security remaining unchanged on the premier bourse, which traded more than 22.80 crore shares and mutual fund units on a turnover of Tk 6,651.75 crore. The daily average turnover was Tk 1,662.93 crore.
Total market capitalisation fell by 0.44 percent to Tk 270,074 crore.
Titas Gas, the state-run fuel company, topped the turnover leaders with more than 43.63 lakh shares valued at Tk 437.48 crore. Other turnover leaders were Beximco Limited, AB Bank, Shahjalal Islami Bank and Premier Bank.
Rahima Food was the largest gainer, which posted a 36.18 percent rise, followed by Kohinoor Chemicals, Prime Textile, Fourth ICB Mutual Fund and Exim Bank.
Progressive Life was the biggest loser with a 20.52 percent slide, followed by Eastern Lubricants, Modern Industries, Rupali Life Insurance Company and Quasem Silk.
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