Dhaka, Bangladesh (BBN)- The Dhaka Stock Exchange (DSE) has launched two price indices in January said to be accurate reflections of market activities.
The indices, DSEX and DS30, were designed by Standard and Poor's, based on the free-float methodology used by the world's major indices.
DGEN and DSEX indices were produced simultaneously from January till July and DGEN was discontinued afterwards. As a result, the graph above depicts the DGEN index till Jul’13.
The DSE evidenced significant volatility and price corrections throughout the first half of 2013 before the market rebounded in mid-2013 following the government’s decision to refinance stock market intermediaries, the Citibank N.A said its annual market update 2013.
The DSE general index grew by 4.4 percent from July 2012 to July 2013, reaching 4,342.3 points.
The government this year passed the Demutualization Act. Subsequently, the Securities and Exchange Commission approved DSE and CSE (Chittagong Stock Exchange) demutualization schemes to separate their ownership from management and convert the stock exchanges into shareholder-owned corporate entities.
The government also announced in March 2013 that investors who suffered losses from the 2010-11 stock market downturns will be compensated. Accordingly, Investment Corporation of Bangladesh (ICB) asked the merchant banks and brokerage firms to apply for loans under the capital market refinancing scheme.
The cabinet approved in August the draft of the Financial Reporting Act (FRA), 2013 to ensure transparency of audit systems, forming a unique structure for the monitoring of firms listed with stock markets and financial institutions.
However, the expected results from these reform initiatives are yet to be materialized.
BBN/SSR/AD-04Jan14-3:55 pm (BST)