Bank, NBFI shares remain under pressure despite weekly index gains

The Dhaka Stock Exchange (DSE) closed the week with its key indices in positive territory, but the banking and financial institutions sector failed to recover from the previous week's slump, according to the bourse's weekly Market Pulse report.

Over the five trading sessions through July 30, the benchmark DSEX index rose 91 points, while the blue-chip DS30 index gained 24 points and the Shariah-based DSES index added 12 points.

Compared with the corresponding period last year, DSEX has climbed 21 percent so far this year, with DS30 and DSES each up 19 per cent.

Despite the index gains, average daily turnover slipped slightly week-on-week, falling to around Tk 1,060 crore from Tk 1,063 crore in the previous week.

Prices rose for the majority of listed companies during the week, 264 stocks advanced against 35 that declined, while 89 remained unchanged. Market capitalisation increased by Tk 3,863.75 crore over the week.

However, the banking sector could not shake off its earlier losses, with bank stocks falling nearly 14 percent and non-bank financial institution (NBFI) shares dropping more than 35 per cent.

Life insurance stocks slid 37 per cent even as general insurance shares climbed about 20 per cent. Corporate bond prices surged 78 per cent, while mutual fund prices fell around 20 percent.

Elsewhere, pharmaceuticals and chemicals shares dropped 14 per cent, and paper and printing stocks fell more than 35 per cent. The fuel and power sector declined nearly 28 per cent, and tannery industry shares were down 19 per cent.

EXIM First Mutual Fund topped the week's gainers' list, posting a weekly return of about 37 percent, while Renwick Jajneswar and Co (Bd) Ltd. finished at the bottom, losing roughly 13 percent.

The mixed sectoral performance underscores a market still searching for balance, broad-based investor appetite is lifting the headline indices and pushing up overall market capitalisation, but confidence in the financial sector, particularly banks and NBFIs, remains fragile.

Analysts will likely watch whether this divergence narrows in the coming weeks, as sustained weakness in financial stocks, a heavyweight segment of the DSE could cap further index gains even if broader sentiment stays positive.�"UNB