Stocks plunge further amid US tariff fears

Stocks on the Dhaka bourse plunged for the second consecutive day today, as heavy sell-offs dragged down prices of most shares, particularly in the textile sector, amid growing concerns over potential US tariffs.

The market opened on a positive note, with the DSEX, the benchmark index of the DSE, rising over 30 points until 11:30am. However, the prime index failed to sustain the gains as sell-offs gripped the market after one and half hours of the trading session, causing the index to decline by 8 points and close at 5,196.

According to the DSE, most stocks traded on the bourse witnessed price declines due to the broad sell-offs, but fundamentally sound stocks managed to attract some investor attention.

On the other hand, the port city bourse, Chittagong Stock Exchange (CSE), settled on green terrain. The Selective Categories' Index (CSCX) rose by 3.1 points, while the All Share Price Index (CASPI) edged up by 0.8 points.

DSE data showed that turnover increased by 13% to Tk469.89 crore, up from Tk415.50 crore in the previous session. However, market capitalisation dropped by Tk3,233 crore to Tk6.73 lakh crore.

Of the 398 stocks traded, 191 declined (48%), 150 gained (37%), and 57 remained unchanged.

EBL Securities, in its daily market commentary, said the benchmark index of the capital bourse failed to return to positive territory despite a brief intraday uptick, as investors' caution persists since the US tariff shock spilled concern over an uncertain market momentum.

"The market opened on a positive note, buoyed by price appreciation in particular large-cap scrips, helping to withstand the gripping broader market sell-offs from the previous session.

"However, the momentum failed to sustain for long as the subsequent cautious selling approach eroded all the early gains, ultimately reflecting the waning investor confidence," the commentary said. 

On the sectoral front, the pharmaceuticals and chemicals sector led with 24.9% of total turnover, followed by miscellaneous and food sectors, both contributing 8.2%.

Sectors mostly displayed mixed returns, out of which IT posted a 1.9% gain, followed by financial institutions and services, each up by 0.7%.

The gainers and losers 

FAS Finance, a non-bank financial institution, topped the gainer list with an 8.33% increase, bringing its share price to Tk3.90, followed by Midas Finance with an 8.16% rise to Tk10.60, Yeakin Polymer with a 6.50% gain to Tk13.10, Daffodil Computers with a 6.29% increase to Tk64.20, and Farest Finance and Investment with a 6.25% rise to Tk3.40.

On the other hand, S Alam Cold Rolled Steels, a concern of S Alam Group, topped the loser list, with its share price declining by 7.50% to Tk27.10, followed by Khulna Printing and Packaging with a 5.57% drop to Tk25.40, EBL NRB Mutual Fund's unit price falling by 5% to Tk3.80, Trust Bank 1st Mutual Fund with a 5% decrease, and Sonargaon Textiles with a 4.95% decline.

Textile stocks take the hit

On 2 April, US President Donald Trump displayed a poster during an event at the White House listing reciprocal tariffs, including 37% on Bangladesh, 26% on India, 34% on China, and 20% on the European Union, in response to duties imposed on US goods.

Following the announcement of these tariffs, publicly listed textile firms witnessed significant sell-offs amid investor fears, as the US market is the largest single-country export destination for Bangladeshi readymade garments (RMG).

On Sunday, out of the 58 textile companies listed on the DSE, 54 saw their share prices decline. Only one textile firm, Dulamia Cotton, bucked the trend with a price increase, while three other firms remained unchanged.

Textile stocks led the market declines, with a sector-wide 3.89% drop, marking the day's steepest losses and wiping out crores in market capitalisation.

Eight textile firms were among the top ten losers on Sunday, including Hamid Fabrics, Simtex Industries, New Line Clothings, and Metro Spinning.

Following Sunday's dip, yesterday, of the listed textile stocks, 35 saw their prices decline, 10 witnessed price increases, and 13 remained unchanged.