Stocks continued their upward momentum for the fourth consecutive session on Wednesday, thanks to the price floor that restored confidence about market direction as stock prices have no chance to go below the floor.
Stockbrokers said many investors are pouring funds into stocks that had suffered a sell pressure last week, especially after seeing the regulator's meetings with stakeholders to attract more funds into the market.
However, the indices witnessed a bumpy ride on Wednesday as investors were active on both sides of the trading fence. At the end of the session, buyers dominated the market and helped DSEX, the broad based index of the Dhaka Stock Exchange (DSE), advance 0.81% to surpass the 6,300 mark.
With the opening-hour buying spree, the major index shot to over 6,353 in half an hour and as sellers booked profits from short rallies, the index went through some intraday corrections.
"The market skyrocketed in the beginning riding on investor optimism resulting from the positive development coming from the finance ministry regarding exposure of banks in stock market investments," wrote EBL Securities in their daily market commentary.
The Ministry of Finance on Tuesday wrote to the central bank that it might adopt the cost basis for calculating the capital market exposure of banks and if that is done, banks might not be compelled to sell off stocks after rallies.
"Favorable regulatory actions along with the recent rise in remittance inflows, decline in imports, and the increase in export earnings have positively impacted market psychology," the commentary read.
Meanwhile, the Dhaka bourse observed a slight increase in participation as the total turnover inched up 1% to Tk1,195 crore on Wednesday.
Textiles topped the sectoral table of turnover, followed by miscellaneous, and pharmaceuticals. Over 40% of the DSE turnover was concentrated within these three sectors.
Most of the sectors displayed mixed returns, of which, miscellaneous, banking, and non-bank financial institutions led the winning table, while ceramics, travel, and the jute sector faced the biggest corrections.
Of the 386 issues traded, 152 advanced, 162 declined, and 72 remained unchanged.
Also, the Chittagong Stock Exchange (CSE) settled in green territory, while turnover in the port-city bourse increased to Tk21.5 crore, from Tk17 crore.