Investors in dejection as Bangladesh's stocks plunge. BBN file photo
Dhaka, Bangladesh (BBN)- Bangladesh’s stocks witnessed yet another big jolt on Tuesday with dull trading activities as nervous investors continued their selling binge on major issues.
The free fall started from the beginning of the session and continued until end of the session with no sign of reversal, according to market insiders.
The key index of Bangladesh prime bourse tumbled to 42 months low on Tuesday as panic-driven investors dumped their holdings to prevent further losses.
DSEX, the prime index of the Dhaka Stock Exchange, slumped 78.66 points or 1.74 per cent to settle at 4,419. It was the lowest level of DSEX in 42 months since June 27, 2016, when DSEX was 4,412.
Lack of confidence, poor macroeconomic indicators, dearth of quality stocks and liquidity crunch exacerbated the ongoing confidence crisis among investors.
Two other indices also ended lower. The DS30 index, comprising blue chips, plunged 30.33 points to finish at 1,508 and the DSE Shariah Index lost 20.27 points to close at 994.
Turnover, a crucial indicator of the market, also fell to BDT 2.81 billion, which was 8.16 per cent lower than the previous day’s turnover of BDT 3.06 billion.
Actually, the Bangladesh Securities and Exchange Commission (BSEC) is doing nothing visible for bringing stability in the market, according to Azam J Chowdhury, president of the Bangladesh Association of Publicly Listed Companies (BAPLC).
"The securities regulator is only holding discussions, whereas the investors' confidence has almost come down to the rock bottom,” the BAPLC chief explained.
On the other hand, former chairman of the securities regulator Dr A B Mirza Azizul Islam blamed non-cooperation among the regulatory bodies concerned, as the outcomes of many decisions taken different times, fail to be visible.
"The listing process of companies having good fundamentals must be strengthened to bring back investors' confidence," Mr. Islam added.
However, growing concern over the country's macro-economic indicators made investors worried, which acted as the main catalyst behind the recent sharp downfall of the index, according to market insiders.
Continuous fall in private sector credit growth, declining export, poor tax revenue collection, and the government's heavy bank borrowing reflected a gloomy state of the country's economy, they added.
Of 30 listed banks, the share prices of 22 declined, while the prices only three advanced marginally.
Of 23 non-banking financial institutes, the share prices of only two rose marginally.
Of 56 textile companies, the share prices of only seven advanced on the DSE.
Telecommunication sector posted the highest loss of 2.92 per cent, followed by financial institutions with 2.82 per cent, engineering 2.58 per cent, power 2.17 per cent, banking 1.41 per cent, food 1.38 per cent and pharma 1.05 per cent.
Losers outnumbered the gainers, as out of 353 issues traded, 278 closed lower and 35 ended higher while 40 issues remained unchanged on the DSE trading floor.
Ring Shine Textiles dominated the day's turnover chart with 12.49 million shares worth nearly BDT 157 million changing hands.
The other turnover leaders were Beacon Pharma, Square Pharma, Standard Ceramic and BRAC Bank.
Anlimayarn Dyeing was the day's best performer, posting a gain of 8.19 per cent while the Tung Hai Knitting was the worst loser, losing 9.90 per cent.
A total number of 111,618 trades were executed in the day's trading session with trading volume of 108.35 million shares and mutual fund units.
On the other hand, the port city’s bourse, the Chittagong Stock Exchange also saw sharp decline with its All Shares Price Index (CASPI)—losing 232 points to close at 13,441 and the Selective Categories Index - CSCX –shedding 144 points to finish at 8,151.
The losers beat gainers, as 173 issues closed lower, 35 ended higher and 22 remained unchanged on the CSE.
The port city bourse traded 7.39 million shares and mutual fund units worth more than BDT 146 million in turnover.
BBN/SSR/AD