Finance minister AHM Mustafa Kamal on Monday said he found no problem with the prevailing situation at the country’s stock market saying that ups and downs in the market were normal.
‘I don’t see that the market is in bad shape,’ he said while talking to reporters after a meeting with officials of Bangladesh Securities and Exchange Commission in capital Dhaka.
He faced a volley of questions from the reporters after the meeting that was convened one day after his arrival in the country from abroad against the backdrop that Dhaka Stock Exchange has already stretched the weekly losing streak to 12 weeks.
DSEX, the key index of DSE, closed at 5,321.41 points on April 18 from 5,959.24 on January 22 and the downward trend eroded Tk 24,824 crore in market capitalisation.
Some of the investors last week took to the streets protesting against the continuous fall.
Mustafa Kamal blamed the media for projecting the current market trend as bad by writing reports that the stock market was on verge of collapse and no one there to look after it.
He asked if anybody should call the market on the verge of collapse for shedding three hundred points in three months.
Referring to the market volatility in the US, Japan and neighbouring India, he said it happened everywhere.
He said that if the price-earnings ratio was treated as benchmark, the present condition of the stock market was good with the PE ratio between 15 and 20.
The market would be called volatile when the PE ratio crosses 80, he noted.
He advised the media not to show the prospect of stock market broadly and said that investors should be well-informed.
Mustafa Kamal, however, said it was unfortunate that the traditional character of investors — short-term gain seeking — could not be changed because of ‘unidentified players in the market’ as he pointed to the share market collapses in 1996 and 2010-11.
Replying to a question why good securities were not supplied to the market on regular basis in line with directive from the prime minister, Mustafa Kamal said the very initiative was ineffective.
He said once the good securities entered the stock market, they became bad ones after mixing with bad securities.
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