Dhaka stocks slumped to a two-and-a-half-month low on Monday with a fall in share prices of more than two-thirds of the traded scrips as investors, unnerved by the financial sector woes, went for selling shares.
DSEX, the key index of Dhaka Stock Exchange, lost 0.90 per cent, or 50.91 points, to close at 5,604.90 points on Monday after gaining 2.60 points in the previous session.
The key index’s position on Monday was its lowest since January 3 when it was at 5,590.47 points. The core index lost 345 points in last two months.
The core index began to fall from the beginning of the day and descended more firmly as the session progressed as investors went for panic-driven share sales amid woes in the financial sector, market operators said.
They said that the financial sector had been going through a liquidity crisis.
Besides, a huge amount of non-performing loans and irregularities sent the sector on the edge, they said.
On February 14, the finance minister AHM Mustafa Kamal at the annual banking conference of Agrani Bank said, ‘At present, the country’s banking and financial sectors are in the most vulnerable position.’
According to a media report, the government may withdraw its deposits from the financial sector to implement large projects including Padma Bridge and to meet expenses for LNG import.
United International University professor Mohammad Musa told New Age that there is no specific reason behind the downtrend in the market, but liquidity crisis in the financial market might be the key reason to drive the bearish sentiment.
He also said that the retail investors get panicked when the index fell continuously simultaneously they become overexcited when the index gained for few days.
EBL Securities in its daily market commentary said, ‘Investors were not confident enough to inject fresh fund while institutional investors continued to follow cautious stance amid ongoing dividend and earnings declarations and they were also concerned about liquidity shortage in the market.’
Therefore, out of the 345 issues traded on the day, 279 declined, just 42 advanced and 24 remained unchanged.
The average share prices of textile, energy, non-bank financial institution and bank sectors dropped by 1.5 per cent, 1.0 per cent, 0.7 per cent and 0.6 per cent respectively.
Market operators said many investors remained on the sidelines to see the next move of the market.
Therefore, the turnover on the bourse plunged to Tk 476.67 crore on Monday from Tk 585 crore in the previous trading session.
A rise in the share prices of some of the large capitalised companies, especially multinational companies, saved the market from further fall.
The average share prices of food, pharmaceutical and telecommunication advanced by 1.8 per cent, 0.5 per cent and 0.1 per cent respectively.
DSE blue-chip index DS30 shed 0.28 per cent, or 5.76 points, to close at 2,017.90 points.
Shariah index DSES lost 0.75 per cent, or 9.81 points, to finish at 1,283.01 points.
BRAC Bank led the turnover leaders with its shares worth Tk 38.20 crore changing hands on the day.
BATBC, United Power Generation Company, Square Pharmaceutical, Dutch-Bangla Bank, Singer Bangladesh, Monno Ceramics, Marico Bangladesh, Bata Shoe and Legacy Footwear were the other turnover leaders.
Marico gained the most on the day with a 6.24-per cent increase in its share prices while United Insurance was the worst loser, shedding 11.25 per cent.
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