Stocks fall on political worries surrounding Khaleda cases

Staff Correspondent | Published: 00:05, Jan 31,2018

 
 

Dhaka stocks fell on Tuesday as investors went for sell-offs because of worries about the country’s political situation surrounding the trial of corruption cases against BNP chairperson Khaleda Zia ahead of the general election.
DSEX, the key index of Dhaka Stock Exchange, slumped by 0.78 per cent, or 48.64 points, to close at 6,127.80 points on Tuesday after gaining 31.72 points in the previous trading session.
Although the market opened in a positive trend, the trend did not sustain for long as investors went on share sales due to the country’s political situation, said officials of a number of brokerage houses.
Market operators said that some of the investors became worried about the political uncertainty ahead of the verdict in a corruption case against Khaleda to be announced by a special court in Dhaka on February 8.
Opposition BNP leaders have already issued warnings about the verdict that the party would not go for election if Khaleda is sent to jail while the government has warned that it would go for tough action against any unrest surrounding the verdict.
Investors’ worries deepened on Tuesday as Khaleda went to the special court to face another corruption case while prime minister Sheikh Hasina went to Sylhet to begin her party’s pre-election campaign raising concern about political uncertainty because of a possibility of a one-sided election like 2014, said market operators.
Market analyst Mohammad Musa, a professor at United International University, told New Age, ‘Stocks definitely fell because of the fear among investors about the political turmoil amid the cases against BNP chairperson.’
Many investors moved to seek safe positions by selling now for avoiding any unforeseen losses, he said.
Musa warned that the tension among the investors might continue as issues after issues will come ahead of the election, likely to be held in December, which might keep the market mostly volatile for the whole year.
The market rebounded in the previous session on Monday after a steep fall on Sunday as invertors’ concern over monetary policy declaration by Bangladesh Bank eased a little as the central bank raised the private sector credit growth target.
On Tuesday, stockbrokers said, the imminent cut in advance-deposit ratio of banks by the central bank also played a role for falling of the stocks.
Many of the large investors fear that the money supply would be squeezed in the capital market as interest rate on both deposit and lending would rise once BB declare the cut in ADR by around 2 percentage points.
BB governor announced on Monday that the ADR would be reduced for controlling aggressive lending by the banks.
All the large capitalised sectors returned negative on Tuesday while financial sectors and telecommunication weighed most on the index.
The average share prices of telecommunication, bank and non-bank financial institutions declined 1.04 per cent, 0.84 per cent, 0.82 per cent respectively.
Besides, energy, pharmaceuticals and cement also declined on the day.
DS30, the blue-chip index of the DSE also plunged 1.17 per cent, or 26.96 points, to close at 2,267.00 points.
Out of the 30 blue chips, 23 declined, just two advanced and five remained unchanged.
Among them, the share prices of City Bank, BRAC Bank and Grameenphone slumped by 3.58 per cent, 1.1.57 per cent and 1.03 per cent respectively.
Although Grameenphone on the day declared 20 per cent profit growth for 2017 against the previous year and 205 per cent dividend for the year, share prices of the market cap leader plunged mainly due to the bearish trend of the market in connection with the political uncertainty.
The turnover at the bourse also declined to Tk 399.22 crore from that of Tk 413.16 crore in the previous session.
Of the 337 companies and mutual funds traded, 201 declined, 96 advanced and 40 remained unchanged.
Shariah index DSES declined 0.76 per cent, 10.97 points, to close at 1,414.47 points.
Grameenphone led the turnover chart on the day with its shares worth Tk 29.33 crore changing hands.
City Bank, Monno Ceramics, Nahee Aluminum Composite Panel, BD Finance, Aamra Networks, Square Pharmaceuticals, National Tubes, Popular Life Insurance Company and IFAD Autos were the other turnover leaders.
Monno Jute Stafflers was the top gainer with a 7.49 per cent rise in its share prices, while Bangas was the worst loser, shedding 8.18 per cent. 

More about:

Want stories like this in your inbox?

Sign up to exclusive daily email

Advertisement

images

 

Advertisement

images