Foreign investment at the Dhaka Stock Exchange remained negative in July for the fourth consecutive month as the overseas investors continued offloading their holdings at the bourse amid concerns over the country’s financial sector and national elections.
In July, the foreign investors sold shares worth Tk 444.74 crore against their purchase of shares worth Tk 412.04 crore with their net investment dipping to negative Tk 32.7 crore.
The net foreign investment remained negative for four consecutive months since April. It was Tk 24.69 crore negative in April, Tk 282.32 crore negative in May and Tk 206.68 crore negative in June.
In June, foreigners bought shares worth Tk 446.61 crore against their sales of shares worth Tk 653.29 crore.
Market operators said the foreign investors were observing the market amid a chaotic situation in the country’s financial sector.
They said media reports about various scams in the banking sector and liquidity crisis at the financial market had made the foreign investors wary about the prospect of the Bangladesh capital market.
Besides, political uncertainties ahead of the national elections, expected to be held at the end of this year, and depreciation of the taka against the dollar kept the foreigner investors on the edge, they said.
A senior DSE official said that depreciation of the taka against the dollar made the foreign investors concerned about injecting fund in the market as their profitability dropped due to the depreciation.
Therefore, the foreign turnover also declined in July by 22 per cent to stand at Tk 856.78 crore compared with that of Tk 1,099.9 crore in the previous month.
DSEX, the key index of the DSE, shed 102 points in July.
Market operators said that the foreign investors might wait for the lowest possible share prices at the market to maximise their gains.
The net investment by the foreign investors at the country’s premier bourse surged to Tk 1,704.94 crore in 2017 from Tk 1,340.70 crore in 2016.
Overseas investors’ turnover at the bourse was Tk 3,362.11 crore in 2010, Tk 1,904.19 crore in 2011, Tk 2,355.23 crore in 2012, Tk 2,834.90 crore in 2013, Tk 6,600.94 crore in 2014 and Tk 7,465.4 crore in 2015.
The net overseas investment at the bourse was negative Tk 767.58 crore in the year of market crash (2010).
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