Stock sales in banking sectors lead to a weekly decline in the Dhaka Stock Exchange (DSE)
The Dhaka Stock Exchange (DSE) indices concluded the week on a bearish note, marking seven consecutive sessions of decline following a rally that peaked on August 3, 2025. Despite a strong July rally that propelled the benchmark index (DSEX) to 5,536 points, the index shed 221.81 points since then, closing at around 5,314 points by mid-August.
The bearish trend was primarily driven by profit-taking and cautious investor sentiment. Investors oscillated between cashing in on recent gains and adopting a wary bargain-hunting approach, which limited sustained buying and encouraged selling.
Late-session selling also played a significant role in pulling indices down, preventing a recovery of lost ground. For instance, on August 13 and 14, there were attempts by buyers to lift the market during mid-day trading, but these efforts were undone by late-session selling.
The market breadth was skewed negative, with more stocks declining than advancing towards the week's end. On August 13, out of 398 traded companies, 203 declined compared to 121 gainers, indicating broad selling pressure.
Sectoral dynamics also contributed to the bearish close. Although the pharmaceuticals, banks, and textiles sectors accounted for a significant portion of the week's turnover, they were not enough to counteract declines elsewhere. Some sectors posted gains, but the overall market sentiment remained bearish.
Trading volumes and turnover slightly increased amid the selling, indicating active but mixed participation without strong buying dominance.
The life insurance sector posted the highest gain of 5.3%, while the banking sector suffered the biggest loss of 3.5%. The blue-chip index, DS30, dropped 17 points to 2,098, and the Shariah-compliant stocks index, DSES, edged down by 0.18 points to 1,170. The prime index, DSEX, fell by 35 points to 5,408, and the market capitalisation increased by 0.40% to Tk7,15,079.22 crore.
The upcoming national election has yet to positively impact investor sentiment. Regulatory efforts to list fifteen state-owned and multinational companies did not stimulate investor positive sentiment either.
The total turnover stood at Tk3,645 crore, down from Tk4,194 crore a week earlier. The weekly average turnover decreased by 8.64% to Tk911 crore. The bullish momentum of the benchmark index lost steam due to a profit-taking sell frenzy.
Favorable developments in US tariff negotiations initially sparked the bullish wave. However, the DSE indices ended the week weaker due to ongoing profit-taking, late-session selling pressures, negative market breadth, and cautious investor sentiment overshadowing short-lived intra-day rebounds.
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Finance professionals and business analysts might find it prudent to closely monitor the Dhaka Stock Exchange (DSE), as the ongoing bearish trend in the stock-market could present opportunities for strategic investing. The sell frenzy, late-session selling, and negative market breadth have resulted in a decline of the DSEX by 35 points, putting the index at around 5,408 points. However, the life insurance sector posted a significant gain of 5.3%, indicating potential areas of growth within the market. Despite regulatory efforts and positive developments in US tariff negotiations, the upcoming national election and cautious investor sentiment have yet to significantly improve the overall market sentiment.
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