Dhaka stocks ended last week in red, extending the losing streak to the third week as the investors remained on the edge in volatile trading resulted from panic-driven sell-offs by retail investors and a wait-and-see policy taken by institutional ones.
Rumours about the possible legal actions by regulators against some market manipulators continued to dampen the market in the week.
The benchmark general index of Dhaka Stock Exchange, or DGEN, lost 47.04 points, or 0.75 per cent, in five trading sessions to close at 6,212.86 points on Thursday. The index had dropped by 327.91 points, or 4.98 per cent, in the previous week.
A decreased participation of institutional investors hit the transaction volume of the bourse with the average daily turnover dropping by 42.52 per cent to Tk 508.08 crore in last week from that of Tk 883.90 crore in the previous week.
The DSE recorded its highest average daily turnover in a week this year positing a Tk 1,562.00-crore average daily turnover in the week of July 10 to 14.
'The market suffered volatility in last week and investors became highly reactive to any rumour,' said Yawar Sayeed, managing director of AIMS Bangladesh Ltd.
He, however, said that the downtrend in the stock market was a usual trend during the month of Ramadan.
He said that the bear run in the market was somehow justified as there was no positive signal for the investors.
'The overall economic forecast is not encouraging for businesses and a possible political unrest also affected the market,' he said.
The latest bear run in the stock market began at the end of July with poor corporate disclosures announced by a number of listed companies and the tight monetary policy adopted by the Bangladesh Bank. The situation was worsened by the announcement made by the SEC that it would take legal actions against the market manipulators. The announcement triggered a large-scale disinvestment by the big fishes, analysts said.
Market operators said the market was facing a liquidity crisis again as the large and institutional investors remained almost inactive.
'The institutional investors are waiting for the share prices to come down further to buy them at a cheaper rate,' said a DSE stockbroker.
'The possible legal actions by regulators against some market manipulators also hold large individual investors back from being active in the market,' he said.
In last week, the Anti-Corruption Commission announced that it would file case against four people including an executive director of Securities and Exchange Commission for market manipulation during the January's stock market crash.
Of the five trading days, the DGEN gained in two days. In the week, investors held protests following steep plunge in share prices.
Some investors said that they were yet to recover losses they incurred in the January debacle and the market started to collapse again.
Finance minister Abul Maal Abdul Muhith, in the last week, termed the demonstrating investors 'Fatkabaj'. He also said that the capital market was now under the grip of gamblers.
On Sunday the DGEN shed 139.74 points, or 2.23 per cent. The plunge prompted investors to take to the streets and the investors staged rowdy demonstration in the business hub Matijheel in the capital.
On Monday, the index shot up by 103.78 points, or 1.69 per cent on institutional buying after a massive fall in share prices in two days.
The index dipped again by 46.12 points, or 0.74 per cent, on Tuesday on selling pressure. On Wednesday, the index dropped further, losing a moderate 15.13 points, or 0.24 per cent.
On Thursday bargain hunters pulled Dhaka stocks following two days of slides when the DGEN gained 50.18 points, or 0.81 per cent.
All sectors except, banks, telecommunications and cement closed red as the market witnessed selling pressure all across the board during the week.
Banking sectors gained 1.09 per cent, telecommunications 4.09 per cent and cement advanced by 0.83 per cent during the week.
Grameenphone advanced by 4.09 per cent in the week following the news that the government had finalised licence renewal fee of mobile phone operators.
Cement sector closed positive as Lafarge Surma Cement gained 4.81 per cent following the news that their Indian subsidiary has started mining operations in limestone mine in Meghalaya.
Of the total 265 issues, 73 gained, 190 declined and two issues unchanged.
Beximco Limited topped the turnover leader with shares worth Tk 121.19 crore changing hands. The rest of the top-10 turnover leaders were Gremeenphone, Keya Cosmetics, Malek Spinning, Lafarge Surma Cement, RN Spinning, United Airways, City Bank, MI Cement and National Bank.
Source : New Age
