Bourses still bullish
Investors advised to be cautious; SEC keeps vigil on price movement
Star Business Report
As both the stock exchanges have been witnessing bullish trade for the last few days, analysts find no rational basis for the galloping trend and advise investors to be cautious. Lucrative initial public offerings (IPOs) of banks attracted a significant amount of undeclared money a portion of which is now in the capital market, they said. Officials of the Securities and Exchange Commission (SEC) and the Dhaka Stock Exchange (DSE) said they are monitoring the market constantly and keeping close eyes on the price movements. "Some of the blue chip securities had been undervalued for long. As some of those companies are declaring good dividends, their prices are going up and it is a normal phenomenon of the market," said a top official of the DSE. DSE-20 index gained 44.83 points yesterday to close at 1258.45 points. Of the 214 listed issues traded, 206 advanced, only four declined and four remained unchanged. On November 1, 2003, the DSE-20 index was 997.22. DSE general index also gained 41.08 points yesterday to close at 983.11 points while it was 804.72 on November 1. "In fact, prices of many shares have gone up by around 40 per cent from a month ago," said a market analyst. "Shares of a cement company was sold at Tk120 on November 1 and its price was Tk 194.50 yesterday." A total of 8,444,324 shares and debentures valued at Tk 24.91 crore changed hands in the DSE yesterday as against 5,639,152 shares valued at Tk 17.39 crore on the previous trading day. The turnover on November 1 was Tk 6.41 crore only. "We welcome natural growth of the market. But I think speculative investment is taking place in the market and small investors who are buying shares at high prices for a short-term gain may be in problem," cautioned Yawer Sayeed, chief executive officer of the Assets & Investment Management Services (AIMS) of Bangladesh Ltd. "We won't be worried if prices of selective shares declaring high dividends go up. As prices of most Z category shares are on rise, it is really a matter of concern," he observed. CSE selective index also went up by 56.24 points to close at 1569.9 points yesterday from 1513.66 points on Monday. Of the 91 listed issues traded yesterday, 86 gained, only three declined and two remained unchanged. A total of 3,783,868 shares and debentures valued at Tk 7.55 crore changed hands in the CSE yesterday as against 2,470,528 shares valued at Tk 4.60 crore on the previous trading day. On November 1, the turnover in CSE was Tk 46.23 lakh only.
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