Stocks slump on economic worries

Staff Correspondent | Published: 00:00, Dec 06,2019 | Updated: 23:39, Dec 05,2019

 
 

Dhaka stocks dropped on Thursday after a slight gain in the previous session as investors went for selling shares amid a continuing deterioration in a number of economic indicators of the country.

DSEX, the key index of Dhaka Stock Exchange, lost 0.67 per cent, or 31.64 points, to close at 4,671.33 points on Thursday after gaining 5 points in the previous session.

The DSEX lost an aggregate of 88 points in last four sessions.

After a slight gain at the beginning on Thursday, the market started falling and continued with the vibe until the end of the session as investors went for share sales, market operators said.

They said that a continuing fall in the private sector credit growth, negative export earnings for last four months, poor tax revenue collection reflected a gloomy state of the country’s economy.

Country’s export earnings continued to decline for the four months since August. The export earnings in November of this fiscal year 2019-20 declined to $3.05 billion from $3.42 billion in the same month of FY 2018-19.

The government’s failure in reining in the surge of non-performing loans in banks also dampened the investors’ mood.

As per the Bangladesh Bank data, the government’s outstanding borrowing from the banking sector increased to Tk 1,41,682.64 crore on October 30 this year from Tk 1,08,095.7 crore on June 30 this year.

The increased borrowing weighed on the ailing banking sector which has been struggling for funds.

Concerns over the country’s economy also prompted foreign investors to continue withdrawing funds for last nine months. The net foreign investment at the DSE dipped to Tk 99 crore negative in November after Tk 96.92 crore negative in October.

Besides, investors hesitated to invest at a market that has remained bearish for long, market operators said.

The DSEX lost more than 1,230 points in last 10 months.

The average share prices of bank sector dropped by 1.1 per cent, textile 1.0 per cent, non-bank financial institution 0.5 per cent and energy 0.3 per cent.

Despite closure of business operations, share prices of Miracle Industries continued rising for the third day on Thursday. Prices of the company’s shares gained 4 per cent on the day.

EBL Securities in its daily market commentary said that the recent market volatility coupled with soaring non-performing loans and liquidity crunch dented the investors’ confidence further that worsened the overall performance of the market.

Share prices of telecommunication increased by 0.1 per cent after recent fall.

Turnover on the DSE declined to Tk 432.41 crore on Thursday from Tk 462.06 crore in the previous day.

Out of the 343 scrips traded on Thursday, 192 declined, 106 advanced and 48 remained unchanged.

DSE blue-chip index DS30 dropped by 0.73 per cent, or 11.8 points, to close at 1,605.82 points.

Shariah index DSES shed 0.52 per cent, or 5.56 points, to end at 1,055.84 points.

SK Trims led the turnover chart with its shares worth Tk 15.9 crore changing hands on the day.

Saiham Cotton, Sonar Bangla Insurance, Indo-Bangla Pharmaceuticals, Paramount Textiles, LafargeHolcim Bangladesh, Daffodil Computers, Sino-Bangla Industries, Miracle Industries and Beacon Pharmaceuticals were the other turnover leaders.

RD Food gained the most on the day with a 9.32-per cent increase in its share prices while Family Textile performed the worst, losing 11.11 per cent.

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