DHAKA, Nov 08, 2024 (BSS) - The country's capital market extended its recovery, with the benchmark index of the Dhaka Stock Exchange (DSE) rising by 116.9 points or 2.25 percent as buyers maintained their dominance across the trading floor, owing to modest rebound in investor sentiment.

The DSEX, the primary index of the DSE, rose by 116.93 points or 2.25 percent, settling at 5,316.33 points. In parallel, the DS30 index, representing 30 major companies, climbed 39.49 points to close at 1,965.54 and the DSES index, which tracks Shariah-compliant stocks, also saw upward trend with 43.01 up at 1,187.91.

Investor's participation in the market increased by 45.4 percent to Taka 6,058.14 million as compared to Taka 4,167.53 million in the previous week. Investors were mostly active in Pharma sector (19.5 percent), followed by Bank sector (15.6 percent) and Textile sector (8.9 percent).

On the sectoral front, Paper & Printing (10.4 percent) generated highest return while, Food Sector (-0.7 percent) exerted moderate correction.

Market total turnover, a critical indicator of investor participation, rose to Tk30,290.68 million over the week, a significant increase from the Tk20,832.63 million recorded the previous week.

Analysts observed that favourable regulatory moves to restore stability in the market contributed to the index's massive rise.

Investor confidence was boosted by the news of capital gain tax cut for individual investors, they opined.

The National Board of Revenue (NBR) has reduced the tax rate to 15 percent on capital gains above Taka 50 lakh from selling shares of listed companies on the stock exchanges for encouraging investment in capital market.

Analysts also observed that the regulatory efforts to investigate the reasons behind the recent market crash by forming a panel helped boost investor confidence to some extent.

Additionally, a meeting between Dr Salehuddin Ahmed, the Finance and Commerce Adviser, and the Bangladesh Securities and Exchange Commission (BSEC) has brought assurances of short-term, medium-term, and long-term measures to address market volatility, they added.

During the meeting, the finance adviser discussed the ongoing market crisis and assured that initiatives would be taken to address these issues in the short term, medium term, and long term to restore stability in the market.

EBL Securities said in its weekly market review that despite the market ending in the red by the close of the week, investor optimism was notably heightened, driven by positive regulatory policy discussions namely early settlement of shares, liquidity support through ICB, and capital gains tax cuts, which contributed to sustain market momentum.

Meanwhile, investors were seen actively switching positions, either booking profits or repositioning in stocks with favorable earnings declarations, reflecting a selective yet optimistic approach in the current market environment, the review added.

MS Safiul Alam, an investor, welcomed the government efforts saying if the government continues the policy supports, it will increase the confidence of investors.

The Chittagong Stock Exchange (CSE) also witnessed higher with the CSE All Share Price Index - CASPI -advancing 409.6 points to settle at 14851.61 and the Selective Categories Index - CSCX gaining 253.69 points to close at 9,032.76.