DSE key index tumbles to 20-day low
During the session till 10:30 am, the DSEX dropped by 1.17% to settle at 5,520
Dhaka stocks' volatility perked up today (15 May), tumbling to a 20-day low as jittery investors snapped options amidst economic uncertainties fuelled by high inflation, a record current account deficit, and a decline in forex reserves.
The benchmark index DSEX of the Dhaka Stock Exchange (DSE) dropped by 58 points, settling at 5,527, and extending the losing trend for three consecutive days.
Market turnover also decreased by 21% to Tk526 crore.
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Among the total traded stocks, 61 advanced, 301 declined, and 33 remained unchanged.
Over the last three sessions, the DSEX lost 169 points, resulting in a market capitalization drop of over Tk8,000 crore, settling at Tk7.02 lakh crore.
The port city bourse Chittagong Stock Exchange (CSE) all-share price index CASPI fell by 104 points to close at 16,060.
The turnover at the CSE also dropped by 8% to Tk13.60 crore.
The managing director of a brokerage firm said regulatory interference was the major reason behind subduing investor confidence.
The Bangladesh Securities and Exchange Commission has reinstated the floor price to mitigate the downward trend in stocks, three months after lifting the previous restrictions.
"So the 3% circuit limit is the main cause for the sudden fall in prices, as traders do not want to be stuck with limited flexibility," he added.
On 24 April, the commission reduced the circuit breaker lower limit to 3% from 10%.
Following this decision, more than 10,000 beneficial owners (BOs) liquidated their entire holdings out of fear that the restriction would freeze their funds.
During a meeting with the Dhaka bourse in Motijheel, the leaders of the DSE Brokers Association of Bangladesh demanded a halt to regulatory interference in the market. They have termed the current market an "artificial market."
While briefing journalists, DSE Chairman Hafiz Mohammad Hasan Babu, who chaired the meeting, said, "It is not possible to make the capital market sustainable with unnecessary regulatory interference."
EBL Securities said in its daily market review, the downbeat vibe in the country's capital market extends further, with the benchmark index and market turnover falling to a 20-day low, owing to persistent selling pressure as wary investors continue to trim their exposure to capital market investments due to dwindling confidence across the trading floor.
Sellers remained predominant right from the start of today's session as they were wary of the market's outlook, which led the majority of scrips to get stuck at the revised lower circuit without having sufficient buyers, it added
