DSEX Weekly Update: The Rebound Meets a Tougher Test
The DSEX closed the week at 5,578, gaining about 46 points after last week’s tentative recovery. The index has moved further away from its recent support test, but it remains below a key resistance area.
Can buying carry the rebound through that level as borrowing costs and fuel prices rise?
Let’s try to answer that by analysing the key factors.
Macroeconomic Factors
The 15-year Treasury bond yield rose to about 9.34% from 9.10%, while the 20-year yield reached about 9.35% from 9.13%. Higher government borrowing demand has interrupted the yield decline that supported the market’s outlook in recent weeks. A sustained rise could make equities less attractive relative to government bonds.
External Factors
Middle East tensions remain the main external risk. Houthi attacks have renewed concern about shipping near Bab el-Mandeb, alongside disruption around Hormuz. If the conflict widens, elevated oil and freight costs could add pressure to Bangladesh’s import bill. US sanctions have also disrupted Iranian international flights, adding to regional uncertainty.
Internal Factors
Energy supply appears less strained than in previous weeks, but higher fuel prices are already raising transport costs and the prices of daily essentials. That adds to inflation pressure on households and businesses. Concerns about law and order may also keep some investors cautious.
Regulatory Developments
Bangladesh Bank issued four new letters of intent for digital banks and renewed an earlier one for Kori Digital Bank. The announcement may support sentiment in related shares, particularly at the opening, but these are preliminary approvals rather than full licences. Broader market momentum will still depend on sustained buying.
Technical Analysis
The weekly chart shows the DSEX closing near 5,578, with resistance around 5,656–5,690. A sustained move above that zone would give the recovery a stronger footing. If the index is rejected there, 5,418 becomes the important support area to watch, followed by 5370, particularly as the month ends.
Investor Focus
The rebound is gaining ground, but it still needs confirmation. Watch whether turnover and participation broaden as the index approaches resistance, while keeping an eye on bond yields, fuel costs, and the Middle East situation.
Leave a comment
Please login to leave a comment or reply.