Stocks up as BB sits with banks to calm jitters

Stocks gained yesterday on both bourses as investors went for bulk buying following news that the central bank sat with commercial banks to discuss their market concerns.
In the afternoon, Bangladesh Bank sat with top officials of the commercial banks to listen their concerns on issues such as reduction of cash reserve ratio and statutory liquidity requirement rates and calculation of capital market exposure limit by taking investment cost rather than market value into consideration.
The benchmark general index of Dhaka Stock Exchange, DGEN, gained 97 points, or 1.66 percent, to close at 5,941. The selective categories index of Chittagong Stock Exchange added 170 points, or 1.63 percent, to finish at 10,627.
Single-day turnover on the DSE hit a two-month high, gaining for a fourth session with all three indices advancing by more than 1 percent.
The day's total turnover stood at Tk 877 crore in terms of value, up 30 percent from Tk 670 crore in the previous session, surpassing the April 13 turnover of Tk 855 crore.
“The market moved up as it got liquidity thanks to some measures of Bangladesh Bank,” said Salahuddin Ahmed Khan, former chief executive officer of DSE.
Khan, who teaches finance at Dhaka University, said participation of institutional investors also boosted turnover.
He said investors sided with buying as they received encouragement following the finance minister's assurance that the government would not include any step detrimental to the interest of the capital market in the national budget.
Most of the investors anticipated that the government would give a chance to invest undisclosed money into the market, said a market operator.
The investors are rushing to the market with fresh enthusiasm, hoping that some sector-friendly proposals will be included in the upcoming budget for the next fiscal year, due to be unveiled on Thursday, he added.
Akter H Sannamat, former managing director of Prime Finance and Investment, said: “The coordinated efforts of the central bank with the Securities and Exchange Commission boosted investors' confidence and encouraged them to go for cheerful trading.”
The government should provide chances to the investors to invest their undisclosed money into the stockmarket, he said.
“If the government does not allow the undisclosed money to be whitened, the money may be invested aboard. As a result, the county will lose a huge amount of currency,” said Sannamat.
Meanwhile, several investors staged sit-in in front of the DSE building in the capital's commercial hub Motijheel, demanding an investment-friendly budget. They also sought scopes so that they can invest their untaxed money in the market.
Of 260 issues traded on the DSE floor, 147 advanced, 107 declined and the rest six remained unchanged.
Banking issues, which make up more than one-third of market capitalisation, gained 2.88 percent. All the 30 issues in the sector closed positive.
Non-banking financial institutions advanced 0.76 percent, telecommunications 0.68 percent and power 0.16 percent.
Aftab Automobiles topped the turnover leaders with 14.81 lakh shares worth Tk 38.58 crore traded.
State-run Pubali Bank was the biggest gainer of the day, posting a 9.56 percent rise, while the Meghna Pet Industries was the worst loser, losing 5.5 percent.