DSEX closes week 4% lower

The country's stock market experienced another volatile week, marked by a significant decline in indices, turnover, and market capitalisation. 

Stockbrokers and market experts said too many negative triggers — rising interest rates, fears of taxes on individual investors' capital gains from listed securities, subdued corporate earnings, and a serious confidence crisis due to the regulator's intervention — are collectively hurting stock bulls.

Stocks listed on the Dhaka and Chattogram bourses traded for four days this week (19-23 May) due to a public holiday on Wednesday.

According to the Dhaka Stock Exchange (DSE) weekly report, the benchmark index, DSEX, closed at 5,312 points, losing 205 points or 3.72% from the previous session, hitting a three-year low.

The highest intraday index loss was 86 points on Sunday, the week's start, and stocks declined across all four consecutive trading sessions. 

According to DSE, total turnover declined by 46% to Tk2,070 crore this week while average daily turnover fell by 32.29% to Tk517 crore, which was Tk764 crore in the previous week. 

In the whole week, trade in the block market stood at Tk335.87 crore as intraday trade on the block market was Tk191 crore on Thursday. 

Market capitalisation fell by Tk48,757 crore in the week as most of the stock price saw erosion amid the huge shares selling-off.

A total of 338 stocks or 87% traded at the DSE saw price fall while 28 stocks' prices advanced and 20 stocks remained unchanged.

EBL Securities in the weekly market commentary said, "The benchmark index of the capital bourse plunged further to deepen its free fall, dragged down by dominant selling pressure as unnerved investors opted to reduce their capital market exposure to avoid further losses amid the prolonged depressed sentiment regarding the market's momentum."

"Despite the regulatory initiative to raise the non-margin limit facility for ICB Securities, the enduring pessimism failed to alleviate since the market remained dominated by sellers throughout the week amid uncertainties leading up to the national budget declaration, allowing the bears to firm their control across the trading floor," the report reads. 

However, the stock market regulator Bangladesh Securities and Exchange Commission (BSEC) on 21 May raised the free limit facility to Tk50 crore from Tk10 crore for ICB Securities, a subsidiary of the state-run Investment Corporation of Bangladesh to increase liquidity flow in the market.

Investors were mostly active in the pharmaceutical sector, the sector contributed 24.6% in the total turnover, followed by the Food & Allied, and Textile sectors by 12.6%, and 11.3% respectively.

Besides that, the stock market has been passing a downward trend in the eight trading sessions in a row. 

As a result, the market capitalisation of DSE dropped by Tk58,000 crore to settle at Tk6.53 lakh crore and DSEX fell by 384 points in the last eight straight days.