Dhaka stocks keep plunging as poor financial reports pour in
Image: Bizbangladesh.net
Dhaka stocks dropped on Tuesday, extending the losing streak to the third day as investors continued selling shares amid declarations of poor earnings and dividends by listed companies.
The key index of Dhaka Stock Exchange, DSEX, slumped by 0.60 per cent, or 28.48 points, to close at 4,670.74 points on Tuesday.
The DSEX lost 101 points in last three sessions.
The index hit a fresh 35-month low on Tuesday after November 22, 2016 when it was at 4,665.35 points, said market operators.
After a flat opening on Tuesday, the market started falling sharply and finished in the negative zone as investors continued selling shares to avoid pitfalls, market operators said.
They said poor financial declarations by the listed companies rubbed salt into the wound at the country’s capital market that has remained bearish for last nine months.
A number of companies including Intech, Aramit Cement and Zahin Textile declared no-dividend for the financial year 2018-19.
Profits of Shasha Denims, Gemini Sea Food, Oimex Electrode and Fortune dropped in FY19 compared with that in the previous year.
Besides, profits of Bata Shoes and Social Islami Bank fell in the third quarter (July- September) compared with that in the same period in the previous year.
Market operators said the DSEX continued hitting record lows that was making investors more nervous on the trading floor.
They said declaring no-dividend and poor earnings for the year ended on June 30, 2019 by the companies made the investors’ confidence situation worse.
Nine more companies — Usmania Glass, Shyampur Sugar Mills, Beximco Synthesis, Shinepukur Ceramics, Aramit Cement, Intech, Zahin Textile, Dulamia Cotton and Imam Button — declared no dividend for the shareholders on Tuesday after nine companies in total declared no dividend on Monday and Sunday.
Share prices of Intech Limited plunged by 36 per cent on Tuesday as the company declared no divided for its shareholders.
Usmania Glass Sheet Factory fell by 28 per cent, Shinepukur Ceramics 14.5 per cent, Zahintex Industries 17 per cent and Imam Button 14.75 per cent for declaring no dividend.
Many investors were in a cleft stick as they could not exit the market by selling their holdings at low prices while could not hold shares for the continuous price erosions.
The DSEX lost 1,280 points in last nine months with the bourse’s market capitalisation declining by more than Tk 66,400 crore.
Market experts said widespread wrongdoings, absence of governance and proper regulatory actions, approval of fundamentally weak initial public offerings and several decisions to appease vested quarters were behind the continued erosion of the investors’ confidence in the stock market.
EBL Securities in its daily market update for Monday said, ‘Recent corporate declarations may not meet investors’ expectation for which, they have exerted sell pressures on certain sector specific stocks. Without any prompt support from the regulators and institutional investors, the market has appeared to struggle to sustain on its own in recent times.’
Turnover on the DSE increased to Tk 358.18 crore on Tuesday from Tk 305.90 crore on Monday.
Out of the 353 scrips traded on the day, 197 declined, 110 advanced while 47 remained unchanged.
DSE Shariah index DSES shed 0.65 per cent, or 7.07 points, to end at 1,067.45 points.
Blue-chip index DS30 decreased by 0.81 per cent, or 13.44 points, to close at 1,635.50 points.
National Tubes led the turnover chart with its shares worth Tk 18.98 crore changing hands on the day.
Sonar Bangla Insurance, Monno Ceramics, Legacy Footwear, Square Pharmaceuticals, Fortune Shoes, VFS Thread Dyeing, Standard Ceramics, Silco Pharmaceuticals and Golden Harvest Agro Industries were the other turnover leaders.
Alif Manufacturing Company gained the most on the day with 21.13-per cent increase in its share prices while Intech Limited performed the worst, losing 37 per cent.
Source: http://www.newagebd.net
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