The enormous 11-day stock rally from the recent market trough has faced a break after investors came up to book some profits on Monday.
DSEX, the broad-based benchmark at the Dhaka Stock Exchange (DSE), closed at 4,533 points, a 0.26 percent correction following Sunday's 4.13 percent jump.
During the near 14 percent jump of DSEX since July 1, a large number of leading stocks seemed to have turned overvalued and buyers are a bit calculative now, said a brokerage strategist while talking to The Business Standard after Monday's trade closed.
Daily turnover at the DSE declined by 7.1 percent to Tk1,048 crore, while appetite for selective stocks helped both the Blue-chip index DS30 and Shariah-based index DSES gain in the end.
UCB Capital wrote in its daily market commentary, "The session experienced some volatility as investors oscillated between optimism and profit booking stance."
EBL Securities notes read, "The market opened on a positive vibe but went through a volatile session and eventually finished in the marginally lower zone as investors opted for quick gain on sector specific stocks in their portfolio which took the index down."
Sideliner investors' confidence is growing and they remained active in the market following the securities regulator's several initiatives to develop the market and to punish some wrongdoers, and also the gradual reopening of the economy and expansionary monetary policy encouraged investors to put fresh stakes on stock, added EBL securities analysts.
Sponsors and directors of a company need to own 30 percent of shares combined, according to the securities regulator's rule, but dozens of companies have not been complying with the rule.
The securities regulator recently warned that actions would be taken against such companies.
The Dhaka Stock Exchange on Monday relayed the warning on its website.
Market analysts said this had caused a rise in demand for the stocks of the non-compliant companies in Monday's trading.
However, investors' attention was mostly concentrated on pharmaceuticals and chemicals which occupied 19.55 percent of daily turnover, followed by engineering (11.25 percent) and the miscellaneous sector contributing to 9.26 percent of daily trading.
Among all the sectors, jute gained the maximum market capitalisation, 5.4 percent, while cement with 3.5 percent gain and telecommunication with 2 percent gain followed.
On the other hand, life insurance stocks faced 3.3 percent price correction on average, followed by service and real estate losing 2.6 percent and general insurance losing 2.5 percent of respective market capitalisation.
Out of 354 issues traded, 111 advanced, 217 declined and 26 remained unchanged.
The port city bourse, Chittagong Stock Exchange, also registered a mixed trend at the end of the session.
CSCX, the broad index there, decreased by 0.9 points and all share price index CASPI increased by 7.1 points over the session.