Dhaka stocks dip on financial sector liquidity crunch

Stocks dropped on Monday amid a fall in share prices of two-thirds of the traded scrips as investors went for selling shares amid worries over the liquidity shortage in the financial sector.
DSEX, the key index of Dhaka Stock Exchange, lost 0.33 per cent, or 19.24 points, to close at 5,690.82 points on Monday after gaining 24 points in the previous two sessions.
After a slight gain at the opening on Monday, the market began to dip and continued to descend until the end of the session as investors went for selling shares amid liquidity shortage in the financial market, market operators said.
They said that the financial sector had been struggling for funds that eventually affected the capital market.
Although Bangladesh Bank extended the deadline by six more months for banks to adjust their advance-deposit ratio from March 31, it would fail to address the liquidity crisis in the sector, they said.
Many people prefer to buy savings certificates than depositing in banks due to a significant gap in interest rates between the government’s savings tools and the bank deposit products, they said.
An increase in government borrowing is also biting into banks’ funds, financial experts said.
EBL Securities in its daily market commentary said, ‘The capital bourse of the country witnessed a downward trend as many investors followed cautious stance ahead of earnings and dividend declarations by financial scrips.’
Bangladesh Bank’s latest time extension for adjusting ADR for banks failed to attract investor’s attention to the banking sector, it said.
Therefore, the average share prices of bank, textile, non-bank financial institution and telecommunication sectors dropped by 1.1 per cent, 0.7 per cent, 0.3 per cent and 0.2 per cent respectively.
Among the prominent scrips, share prices of Dutch-Bangla Bank, Investment Corporation of Bangladesh and Square Pharmaceutical declined most on the day.
On the other hand, share prices of cement, pharmaceutical and energy advanced by 2.5 per cent, 0.3 per cent and 0.1 per cent respectively.
The turnover on the bourse increased to Tk 506.84 crore on Monday from Tk 462.14 crore in the previous trading session.
Out of the 345 issues traded on the day, 199 declined, 100 advanced and 47 remained unchanged.
DSE blue-chip index DS30 declined by 0.12 per cent, or 2.46 points, to close at 1,998.87 points.
Shariah index DSES dropped by 0.15 per cent, or 2.05 points, to finish at 1,308.99 points.
Monno Ceramic Industries led the turnover leaders with its shares worth Tk 31.20 crore changing hands on the day.
United Power Generation Company, Dutch-Bangla Bank, Singer Bangladesh, LafargeHolcim Bangladesh, Fortune Shoes, Nurani Dyeing, National Polymer, Bangladesh Submarine Cable Company and SK Trims Industries were the other turnover leaders.
Safco Spinning Mills gained the most on the day with a 6.43-per cent increase in its share prices while Dutch-Bangla Bank was the worst loser, shedding 6.52 per cent.
Source: http://www.newagebd.net

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