Dhaka stocks rout continues on Kamal comments

Stock investors hold rally in protest against the prolonged downward trend at the capital market, in front of the Dhaka Stock Exchange building at Motijheel in Dhaka on Wednesday. — New Age photo
Dhaka stocks on Wednesday dropped for the second day as panicked investors continued with heavy sell-offs following finance minister’s comments that there was no problem in the capital market. 

The key index of Dhaka Stock Exchange, DSEX, dropped 0.38 per cent, or 20.49 points, to close at 5,240.36 points on Wednesday after losing 62.87 points in the previous session. The position of DSEX on Wednesday was lowest after December 18 last year when it was at 5,233.59 points. In line with the previous day, the market began to fall from the very beginning of the day’s trading and ended up in the negative zone as investors continued with panic driven share sales following finance minister’s remarks made on Monday, market operators said.

Finance minister AHM Mustafa Kamal, after a meeting with officials of Bangladesh Securities and Exchange Commission, said that he found no problem at the capital market despite the record 12-week slump in stock prices at DSE. DSEX lost over 700 points in the 13-week fall till Wednesday because of a number of issues including liquidity shortage and rampant share sales by placement shareholders, and wiped out Tk 30,528 crore from the market capitalisation in the period.

Investors, who had been on the edge due to the continuous slump, got panicked with the minister’s comments which showed his lack of empathy towards the investors’ woes and effort to revive the market, said market operators. After the market rout on Tuesday because of the minister’s comments, some of the institutional investors, including Investment Corporation of Bangladesh, went for buying shares on Wednesday to revive the market, but failed due to the mounting sale pressure from the general investors.

Some of the affected investors on Wednesday continued with their protest in front of the DSE building at Motijheel against the free-fall of share prices blaming Kamal for the latest round of rout. They said that Kamal’s remarks made investors more panicked and the market unstable. They continued to demand an immediate resignation of BSEC chairman M Khairul Hossain for his failure in regaining investors’ confidence during his 8-year tenure. Investors have lost confidence over the market as the regulator continuously failed to address manipulations and wrongdoings in the market, they said.

Of the 345 issues traded at DSE on Wednesday, 203 declined, 104 advanced and 39 remained unchanged. Share prices of United Power Generation & Distribution Company Limited plummeted by 8.7 per cent on the highest as BSEC rejected its application for considering a share purchase agreement between the company and a foreign company regarding sales of shares of UPGDCL held by United Mymensingh Power Limited. Average share prices of energy, textile, telecommunication and bank sector plunged 3.23 per cent, 1.02 per cent, 0.57 per cent and 0.56 per cent respectively.

The turnover on the bourse increased to Tk 332.84 crore on Wednesday from that of Tk 298.62 crore in the previous trading session because of institutional investors’ effort to halt the slide of DSEX. DSE blue-chip index DS30 also declined 0.24 per cent, or 4.60 points, to close at 1,868.13 points. Shariah index DSES shed 0.35 per cent, or 4.26 points, to finish at 1,211.14 points.

United Power Generation Company led the chart of turnover leaders with its shares worth Tk 23.56 crore changing hands on the day.
National Tubes, Monno Ceramic Industries, Fortune Shoes, Bangladesh Submarine Cable Company, BRAC Bank, Fine Foods, Grameenphone, BBS Cables and Doreen Power were the other turnover leaders. Fine Foods gained the most on the day with a 9.90-per cent increase in its share prices while Premier Bank was the worst loser, shedding 18.46 per cent.
Source: http://www.newagebd.net

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