Market backfires as index declining two and a half months
Staff Reporter :
Investors panicked in the volatile capital market after two and a half months of index declines. Investors have spent more time worrying about getting more investment than they have had the chance to be happy with the index’s rise this time around.
The benchmark DSE index fell below 5,500 points in three years on Thursday, trading down 15.01 percent from the previous day, a day after regulator BSEC set the maximum 3 percent circuit breaker for falling share prices.
The capital market traded for a total of 46 days, from February 12 to April 25. In these 34 days, the index has decreased. The remaining 12 days only increased the index.
In 34 days DSE’s main index DSEX fell by 1335.94 points and 12 days index rose by only 407.35 points.
The trend of decline is such that the market capitalization has decreased by Tk 3.14 thousand crore in a single day.
Former President of Bangladesh Merchant Bankers Association (BMBA) Sayadur Rahman said, mainly due to the fall in two and a half months, panic has spread among investors. They are not making new investments to protect their investments, but are also selling their holdings to reduce losses.
As a way out of this, he said, the capital market is not always like this. So be patient. Especially during this period the listed companies publish their financial report for December closing. Big investors look at those factors and make investment decisions.
There is nothing to fear. And the regulator set the minimum circuit breaker for the stock on Wednesday. I hope this decline in the capital market will end soon.
Sayadur Rahman said it is a misconception that institutional investors are not investing. All institutional investors are investing more or less.
On Thursday, DSEX, the main index of the Dhaka Stock Exchange (DSE), went down by 60.49 points or 1.08 percent to 5,518.48. Two other indices also ended sharply lower with the DSE 30 Index, comprising blue chips, plunged 10.17 points to finish at 1,974.51 and the DSE Shariah Index (DSES) lost 12.30 points to close at 1,217.27.
Turnover, a crucial indicator of the market, decreased by 15.1 percent to Taka 511.43 crore which was Tk 602.74 crore at the previous session of the week.
Out of 396 issues traded, 300 declined, 69 advanced and 27 remained unchanged on the DSE trading floor.
EBL Securities a stock brokerage, said in its daily market review- The depressed capital market observed further backlash as investors reacted adversely to the regulator’s effort to clutch down the prolonged free-fall with a revised lower circuit breaker limit to 3%, while the dominant sell-offs in the majority of scrips led the intra-day benchmark index to plunge below the 5,500 mark after 3 years.
Sellers remained predominant right from the start of thursday’s session as they were wary of the market’s outlook, which led the majority of scrips to get stuck at the revised lower circuit without having sufficient buyers. However, some opportunistic investors opted to take positions in particular beaten-down lowcap scrips by the end of the session with a positive expectation of a potential short-term gain, EBL added.
Orioninfu topped the turnover chart, followed by Lovello, ITC, Kohinoor and Asiaticlab.
ADNTEL was the day’s top gainer, posting 8.66 percent gain while BATASHOE was the worst loser, losing 3.77 percent.
On the sectoral front, Pharma (25.0%) exerted the issues highest turnover, followed by Food (14.8%) and IT (9.3%) sectors. Almost all the sectors displayed dismal returns, out of which Tannery (-2.5%), Food (-2.1%) and Financial Institution (-2.0%) exerted the most corrections on the bourse today, while Jute (5.6%), IT (2.1%) and Paper (1.4%) exhibited some positive returns.
Block trades contributed 3.2 percent of the overall market turnover. Orion Infusion Ltd. (+2.5%) was the most traded share with a turnover of Tk 31.7 crore, said BRAC EPL Stock Brokerage.
The Chittagong Stock Exchange (CSE) also ended sharply lower with the CSE All Share Price Index – CASPI -losing 164.44 points to settle at 15,815.75 and the Selective Categories Index – CSCX- shedding 100.27 points to close at 9,521.92.
Of the issues traded, 161 declined, 33 advanced and 25 issues remained unchanged on the CSE.
The port city’s bourse traded 34.83 lakh shares and mutual fund units with turnover value worth about Taka 11.11 crore.
