Stock market volatility marks first eight sessions under BNP rule
As the market moves forward, analysts say sustained improvement will depend less on short-term sentiment and more on the implementation of credible reforms aimed at strengthening governance, boosting liquidity and rebuilding trust among domestic and foreign investors.
The Dhaka Stock Exchange has experienced a volatile yet gradually stabilising trend during the first eight trading sessions after the BNP assumed office, reflecting investor optimism alongside uncertainty over regulatory reforms and policy direction.
On the day the BNP officially formed the government on 17 February, the benchmark DSEX index of the Dhaka Stock Exchange closed at 5,570 points with turnover at Tk1,222 crore, indicating strong investor participation. However, the rally quickly lost steam.
The following session on 18 February saw the index fall to 5,519, with turnover dropping to Tk936 crore. The downward trend continued on 19 February, the day Ramadan began, when the DSEX declined further to 5,465 and turnover fell sharply to Tk560 crore.
Trading hours were shortened by 40 minutes for Ramadan, contributing to lower turnover in subsequent sessions. On 22 February, the index marginally recovered to 5,467 with turnover of Tk568 crore.
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Momentum improved on 23 February as the DSEX climbed to 5,553 and turnover rose to Tk718 crore. The market slipped slightly again on 24 February, closing at 5,542 with turnover increasing to Tk825 crore.
On 25 February, the index edged up to 5,554 while turnover declined to Tk565 crore. By 26 February, the DSEX regained strength to close at 5,600, accompanied by a strong rebound in turnover to Tk947 crore.
The overall performance suggests that while initial euphoria faded quickly, the market has shown resilience amid ongoing discussions about regulatory restructuring and reform.
Finance Minister Amir Khosru Mahmud Chowdhury recently hinted at restructuring the securities regulator, stating that although the current upward trend may reflect optimism surrounding the democratic transition, only sustainable and structural reforms can ensure long-term stability.
Speaking to journalists during a visit to Chattogram, he emphasised that sentiment-driven gains would not bring fundamental change and that comprehensive reforms, including amendments to laws and regulatory frameworks, are under consideration.
He also stressed the importance of strengthening the Bangladesh Securities and Exchange Commission, enhancing transparency and adopting a zero-tolerance stance against irregularities.
The government has already begun searching for a new BSEC chairman, as the current commission, formed during the interim administration and led by Khondoker Rashed Maqsood, has struggled to restore investor confidence.
Finance ministry officials indicated that the regulator may undergo broader restructuring as part of efforts to address long-standing weaknesses in a market that has lagged behind the country's overall economic growth.
Stakeholders say that several private-sector professionals and at least one academic from the University of Dhaka have shown interest in leading the commission. However, many market participants favour leadership from the private sector, citing experience and the need for market-oriented reforms.
The DSEX had initially surged nearly 200 points to a five-month high on 15 February, the first trading session after the BNP's landslide victory in the 13th national election, reflecting investor optimism. That enthusiasm, however, was tempered by uncertainty over the regulatory leadership and broader policy direction.
Minhaz Mannan Emon, director of the DSE, said the BNP's election manifesto included a specific roadmap for capital market development, raising expectations among investors. According to him, thousands of investors who suffered heavy losses in the past decade are now looking to the new government for meaningful reform and accountability.
Notable gainers over the eight-session period included National Bank, S Alam Cold Rolled Steels, Shinepukur Ceramics Limited, Beximco Pharmaceuticals, BIFC, Prime Finance, GSP Finance and Fareast Finance.
Market insiders noted that several stocks that had remained under pressure during the interim government due to production closures and liquidation risks rebounded sharply following the political transition.
As the market moves forward, analysts say sustained improvement will depend less on short-term sentiment and more on the implementation of credible reforms aimed at strengthening governance, boosting liquidity and rebuilding trust among domestic and foreign investors.
