Trading hits nine-month high as DSE turnover surges near Tk 8bn

After crossing the 5,000-point threshold, turnover has soared with gains in banks and pharma, but warnings of a bubble persist

Turnover on the Dhaka Stock Exchange (DSE) has climbed to its highest in nine and a half months, approaching Tk 8 billion amid sustained investor momentum following the index’s recovery past 5,000 points.

On Thursday, total turnover reached Tk 7.90 billion, up from Tk 7.34 billion the previous day.

The last time trading volumes crossed Tk 7 billion was on Sept 25 last year, when the figure hit Tk 7.97 billion. Since then, most trading sessions have seen volumes remain below Tk 5 billion.

The DSE had earlier broken the Tk 5 billion daily turnover barrier on Jul 3, after which the momentum continued without looking back. The very next day, turnover crossed Tk 6 billion and climbed further to Tk 6.5 billion.

Following a series of market reform initiatives, investor confidence has returned, helping Wednesday’s turnover cross Tk 7 billion for the first time in over nine months. On Thursday, turnover rose even higher as the benchmark DSEX index added another 15 points. The index had closed the previous day at 5,116.89.

Despite the positive trajectory, many investors have voiced concern over the lack of new company listings.

Without them, the market could once again enter a speculative “bubble”, warned DSE Brokers Association (DBA) President Saiful Islam at a workshop attended by regulators on Jul 14.

A capital market bubble occurs when asset prices -- stocks or bonds -- inflate far beyond their true value, fuelled by investor hype rather than economic fundamentals.

The index rose sharply from the start of trading on Thursday, adding 43 points by 1pm to reach 5,159. However, late-session profit-taking brought a slight correction, and the DSEX ended the day at 5,132 points.

Thursday’s surge in turnover lifted DSE’s market capitalisation by Tk 61.5 billion in a single day, taking the total to Tk 6.87 trillion. The previous day had seen a Tk 37.16 billion rise, with total capitalisation reaching Tk 6.81 trillion.

Even with higher turnover, most stocks ended lower than the day before. Of the 396 companies traded, 153 (38 percent) advanced, 180 (45 percent) declined, and 63 remained unchanged.

The banking sector topped the day’s turnover, contributing Tk 1.20 billion, well above its usual daily range of Tk 500–700 million. Of the 36 banking stocks, 8 gained, 16 declined, and 11 ended flat.

The pharmaceuticals and chemicals sector followed with Tk 960 million in trades, engineering with Tk 788.5 million, and textiles with Tk 705 million.

Top gainers by closing price included Rahima Food, BBS Cables, and Acme Pesticides, while Padma Life Insurance, National Bank, and People’s Leasing and Financial Services posted the steepest losses.