Dhaka stocks rebounded strongly on Monday after sharp decline in the previous trading session as investors became optimistic following a regulatory move to request the finance minister AMA Muhith to scrap the proposed gain tax on individuals in the finance bill.
The key index of Dhaka Stock Exchange, DSEX, increased at 4,415.96 points, adding 1.60 per cent or 69.62 points on Monday.
The DSEX on Sunday, first trading session after the budget was proposed before the parliament on last Thursday, declined to a five-month low at 4,346.33 points shedding 50.20 per cent.
Market operators said that investors, who were panicky after the imposition of gain tax on individual in the proposed budget on Thursday last week, increased their participation on the trading floor after the capital market regulator as well as the bourses decided to press the government to scrap the capital market unfriendly proposals from the budget.
The government in the proposed finance bill imposed 3 per cent taxes on the individuals with more than Tk 10 lakh capital gain in a year, while the gain tax will be 5 per cent if an individual earns more than Tk 20 lakh a year.
Bangladesh Securities and Exchange Commission officials on Monday said that they will meet the finance minister AMA Muhith on Tuesday to request him to withdraw the newly imposed gain tax as the capital market is yet to recover after the market crash in 2010-11.
‘Investors might have become optimistic on the day after they came to know that the BSEC and the bourses will request the finance minister to scrap the newly imposed tax burden from the capital market investors,’
said Union Capital managing director Md Akter H Sannamat.
Besides that, another section of investors decided to purchase shares at cheap price after a straight five-day fall which might be another reason behind the day’s bouncy vibe in the market, he said.
‘Offsetting budget-specific psychological hit, a natural reversal powered by lucrative prices kept market sentiment upbeat,’ IDLC Investments said in its daily market commentary.
‘Besides, indices positioning around support level offered investors some space of re-assessment, today [Monday],’ it said.
‘These factors accumulated buying pressure and forced DSEX to cross 4,400 points level in early hours,’ said IDLC.
In the meantime, Cement sector resumed its dominance with 4.58 per cent increase, while NBFI sector revived by 3.48 per cent rise. But, textile sector fell in trap of profit booking, shedding 0.58 per cent, said IDLC.
DS30, the blue-chip index of the bourse, advanced by 1.79 per cent, or 28.74 points, to close at 1,629.04 points.
The shariah index of DSE, DSES, finished at 1,015.42 points, gaining 1.84 per cent or 18.42 points.
The turnover of the bourse increased to Tk 420.58 crore on the day which was Tk 416.11 crore in the previous trading session.
Of the 294 shares and mutual funds that changed hands, 211 advanced, 65 declined and 18 remained unchanged.
-With New Age input
