Banking, mutual funds trading up halt DSEX slide

The key index of Dhaka Stock Exchange (DSE) has avoided a big dip, thanks to fundamental banks and mutual funds, which contributed heavily to trading.

The DSEX, the benchmark index, shed 12.94 points on Tuesday, closing at 4951 points. It had hit 4,964 points on Monday.

Trading began on a negative note on Tuesday morning, as the DSEX lost eight points inside the first hour. Trade volume then rose for banks and mutual funds as the key index recovered lost points.

As trading climbed in the country’s premier bourse, the index neared 5,000 points around 11:45am, but the momentum was short-lived due to selling pressure. The market went into correction in the final hours of the day.

The turnovers slipped to Tk 5.49 billion, down from Monday’s Tk 5.84 billion, the highest in almost two and a half months.

In terms of closing numbers, the banking sector drove 27 percent of the trading as shares worth Tk 1.38 billion changed hands in the sector, which usually registers trading worth Tk 600-800 million. On Monday, the banking sector posted Tk 745 million in turnovers.

Of the 61 commercial banks, 36 are listed in the capital market and among them, 17 have finalised their 2024 financial report and declared the investors’ dividend. Seven of these banks reported satisfactory profits while deposits exceeded expectations for some others.

At this time of the year, investors look forward to banks’ dividend declaration, which shapes their decision to make changes in their investment plans.

However, Bangladesh Bank has not yet approved the annual reports of 19 banks. These banks were supposed to reach a decision on dividends in board meetings held on Apr 30, but their discussions were inconclusive and annual reports were not delivered.

Following media reports on the issue, the banks officially informed investors about this in an announcement.

As investors investigated the matter on Monday, the turnover in the sector surged on Tuesday. The share prices of 27 banks soared, registering a 75 percent rise.

On the other hand, the share prices of 26 mutual funds surged, posting a 72 percent rise.

According to DSE data, the share prices of most companies declined on Tuesday. Of the 397 listed companies and funds, 116 rose in price, 253 dropped, while 28 traded at the previous price.

Based on closing prices, Baraka Power, NRB Bank and Bashundhara Paper Mill emerged as the top gainers on the DSE, while Khulna Printing and Packaging, Khulna Power Company and Haqqani Pulp were the biggest losers.