Dhaka stocks advanced in the past week, extending the gaining streak to the 10th week as investors kept buying shares with expectations that the market would gain further.

DSEX, the key index of the Dhaka Stock Exchange, advanced by 1.65 per cent, or 79.11 points, over the week to close at 4,873.18 points on August 27, the last trading session of the week.

The DSEX gained 912 points in the 10-week rally after prolonged bearishness on the market.

The key index gained all sessions except one in the last week as investors remained enthusiastic on the trading floor throughout the week, market operators said.

They said that investors found that share prices of most of the companies still remained undervalued, and they thought that buying those shares could be profitable.

The 10-week rally started since June 18 when some institutional investors had come forward to inject funds through buying shares at bargain prices following the Bangladesh Securities and Exchange Commission’s assurance that the floor price mechanism would not be lifted soon.

Amid the coronavirus outbreak in the country, the BSEC has introduced the system that prevents prices of a company’s shares from falling below a certain level.

Later, the other institutional investors and the retail investors started joining the rally as the country’s economic activities had gradually reopened.

The BSEC’s some punitive actions against the wrongdoers on the market and steps to develop the market lifted the investors’ confidence in the market.

The Bangladesh Bank announced expansionary monetary policy on July 29 that was expected to increase fund flow to the financial market.

The country’s economy showed some signs of recovery from the pandemic fallout with a record surge in remittance and export earnings that also reduced the investors’ concern about the economy.

Share prices of a number of multinational companies including Grameenphone, British American Tobacco and Singer Bangladesh soared by more than 10 per cent in the week that fuelled the rally.

Share prices of most of the companies in the ‘Z’ category kept rising abnormally over the week, posing risk to investors amid the BSEC’s move to streamline the junk companies with restructuring their boards.

The regulator also decided to reduce the transaction settlement cycle for the ‘Z’ category companies to T+3 from existing T+9.

The ‘Z’ category groups low-profile and non-performing companies.

Share prices of Zeal Bangla Sugar Mills, Jute Spinners, Meghna Pet Industries and Syampur Sugar Mills soared by over 20 per cent each over the week. The companies are in the ‘Z’ category.

EBL Securities in its weekly market commentary said that the DSEX gained as investors were cheerful on the trading floor throughout the week due mainly to lower yields on the money market, active regulatory stance to improve market discipline and expansionary monetary policy state of the country.

Average share prices of telecommunication, energy, textile and pharmaceutical sectors advanced by 9.2 per cent, 3.1 per cent, 2.0 per cent and 1.9 per cent respectively.

Out of the 362 issues traded last week, 181 advanced, 150 declined and 29 remained unchanged.

The daily average turnover on the DSE dropped to Tk 828.84 crore in the past week compared with that of Tk 1,179.08 crore in the previous week.

DSE’s blue-chip index DS30 advanced by 2.61 per cent, or 43.03 points, to finish at 1,690.1 points.

DSES, the Shariah index of the bourse, also gained 2.75 per cent, or 30.27 points, over the week to close at 1,130.61 points.

Bangladesh Export Import Company led the turnover chart with shares worth Tk 258.08 crore changing hands in the past week.

Beximco Pharmaceuticals, Orion Pharmaceuticals, LafargeHolcim Bangladesh, Grameenphone, IFIC Bank, Square Pharmaceuticals, British American Tobacco Company, BRAC Bank and Bangladesh Shipping Corporation were the other turnover leaders.