Dhaka, Bangladesh (BBN) – The prime index of the Dhaka Stock Exchange (DSE) posted 8.8 per cent return in 2016 over the previous year as investors’ confidence is getting back reflected in the upward movement of the price indices.
“The year 2016 ended with hope and aspiration as the market closed in green zone,” said IDLC Investments, a merchant bank, in its yearly stockmarket review.
“A consistent rally of last two months assisted the DSE prime index to stay above 5,000 points level, while yielding a total of 8.8 percent return for this year,” said the merchant bank.
Between January 1 and December 29, 2016, DSEX, the prime index of the Dhaka Stock Exchange (DSE), rose 406 points or 8.8 percent to close at more than two years’ high at 5,036.05 points.
The blue chip index-DS30 and Shariah compliant index-DSES also saw positive return of 7.65 percent and 3.45 percent respectively in 2016 over the previous year.
The daily turnover, an important gauge, stood at BDT 4.98 billion on average, up 18 percent year-on-year in 2016.
The port city bourse Chittagong Stock Exchange (CSE) also witnessed positive return as its Selective Categories Index – CSCX – posted a 9.31 percent return to settle at 9,369.91 points.
Market capitalisation of the DSE reached to Tk 3,412.44 billion, an 8.0 percent rise from the previous year.
Terming the year 2016 was very promising after the market debacles 2010-11, a market expert said, “This is the time for long term investments”.
Net foreign investment also recorded 247 percent rise to BDT 13.41 billion in 2016 compared to the previous year, which indicates that the capital market is being viewed as a viable investment destination.
After availing the Bangladesh Bank’s (BB) policy support for adjustment of their stock market overexposure by July 21, 2016, the scheduled banks were also active in the capital market.
According, the banking sector posted a 25.7 percent gained year-on-year in 2016.
During the year of 2016, 11 new issues were listed on the DSE, which raised aggregate amount of BDT 8.49 billion. With the inclusion of the new securities, the total number of listed issues on the DSE stood at 560.
However, search for strategic partners for demutualised stock exchanges to bring state-owned entities including big companies in stock market is still a major challenge.
Although the premier bourse and the port city bourse were demutualised three years back, they are yet to find any strategic investor in line with the demutualization scheme.