All indices of Dhaka stock exchange scaled new heights and turnover set a new mark Sunday as banks surged in anticipation of a bumper year-end profit, luring more investors to the overheated market.
Dealers said over-enthusiastic retail investors have shoveled in fresh funds into the market to steer its benchmark index closer to 9,000, defying warning the market is “dangerously overbought” and could plunge any moment.
The market made a flying start in the morning as the DSE General Index (DGEN) – the market barometer — hit 8,965 in mid trading session before losing steam to finish 0.91 per cent or 80.41 points up at 8918.51 – a new record.
The broader DSE All Shares Price Index (DSI) gained 0.79 per cent or 58.03 points to a record 7,383.94. The DSE-20 blue chip index sharply rose by 2.76 per cent or 145.65 points to reach 5,429.29.
It was the third consecutive day that the market indices have set new records with the DGEN alone adding more than 300 points – or more than three per cent — since Wednesday.
Turnover stood at 32.50 billion, beating the previous record of Tk 32.08 billion set on October 31 this year.
“Market surged over the last few days due to arrival of overenthusiastic new investors. They have invested huge funds,” said Mr Arif Khan, deputy-managing director of IDILC Finance Ltd.
Khan, also the head of merchant banks association, warned that the bull-run is “unsustainable” as most of the stocks are “extremely overvalued” and could see “massive correction”.
“It is an alarming trend and is not beneficial for the market in the long term. The DSE and the securities regulator have cautioned the investors repeatedly over the last few months. But nobody is listening,” he said.
