Stocks rebound strong as regulator raises margin on margin lending
DSEX billed 103.89 points or 2.01% on Tuesday to finish at 5,281 points
The key Dhaka Stock Exchange (DSE) index, DSEX, has rebounded strongly to green from the past two sessions after experiencing the largest one-day decline in a year as investors took a stance on levels of lucrative prices.
DSEX charged 103.89 points or 2.01% on Tuesday to finish at 5281 points.
The market opened higher, which persisted until the end, on the initiative of the securities regulator to increase the margin lending limit for investors to curb the free fall in stock prices , said market insiders.
Investors will get a loan-to-margin ratio of 1: 0.80, if the key DSE index remains below 7,000 points, according to the latest ruling by the Bangladesh Securities and Exchange Commission (BSEC). For example, equity investors will get a maximum loan of Tk 80 if they buy Tk 100 shares.
However, if the DSEX crosses the 7,000 mark, the loan limit will drop to 1: 0.50.
Previously, investors had obtained margin loans of Tk 50 against the purchase of shares worth Tk 100.
Meanwhile, revenue increased 114.89% to Tk508 crore. The general insurance industry dominated the revenue chart, covering 26.8% of total revenue.
EBL Securities, in its daily market commentary, said the market corrected the damage caused by the initial drop in the foreclosure statement and the index added 192 points in the previous days.
Fears of foreclosure appeared to subside and investor attitudes turned positive towards the stock market due to the relentless efforts of the market regulator.
Beximco secured the leading position on the highest turnover chart with a turnover of Tk 44.3 crore and its share price closing at Tk 74.2 per share. The action was followed by Robi Axiata with Tk38.1 crore, General Insurance Asia-Pacific with Tk32.2 crore, LankaBangla Finance with Tk21.1 crore and Beximco Pharma with Tk16 crore.
Islami Insurance had the highest gain of 10% during the session. The action was followed by Northern General Insurance with 10%, Bangladesh National Insurance with 9.9%, Federal Insurance with 9.9% and Continental Insurance with 9.9%.
Mercantile Bank has had the worst luck with its price down 12%. The stock was followed by Bangladesh Industrial Fin with 4.8%, ACI Formulations with 2.9%, ICB Islamic Bank with 2.8% and Southeast Bank 1st Mutual Fund with 2.4%.
Of the issues traded, 240 won, 15 fell and 91 remained unchanged during the session at DSE, while 146 gained, 12 declined and 30 remained unchanged on the Chittagong Stock Exchange.
The port city stock exchange has also chosen the green path. The selected indices (CSCX) and All Share Price Index (CASPI) rose by 178.9 points and 297.1 points respectively.