Foreign portfolio investment at DSE turns negative in Oct

The net foreign portfolio investment at Dhaka Stock Exchange turned negative again in October as the overseas investors went for pulling out funds from the market amid political jitters ahead of national elections.
In October, the foreign portfolio investors bought shares worth Tk 282.50 crore against their sales of shares worth Tk 484.18 crore with their net investment standing at Tk 201.68 crore negative.
In September, the net oversees investment had become positive at Tk 35.16 crore with the foreign portfolio investors buying shares worth Tk 247.50 crore and selling shares worth Tk 212.34 crore after five consecutive months of negative figure.
It was Tk 24.69 crore negative in April, Tk 282.32 crore negative in May, Tk 206.68 crore negative in June, Tk 32.7 crore negative in July and Tk 5.75 crore negative in August.
The FPIs pulled out Tk 719 crore from the Bangladesh capital market in last seven months as they anticipated that the political tensions surrounding the national elections would drag down the market.
The overseas investors were assessing political risk factors surrounding the political developments before the elections scheduled to be held on December 30.
The rising political activities over the months kept the investors at bay, market operators said.
DSE managing director KAM Majedur Rahman told New Age that the foreigners usually became cautious when national elections approached in a country.
It might be their strategy to move their funds to different places in accordance with the degree of risks and safeties of their funds, he said.
Majedur also said that a depreciation of Bangladesh currency taka against the US dollar played a key role in withdrawing funds by the foreign portfolio investors.
The DSE’s key index, DSEX, lost 84.83 points in October to close at 5,368.95 points on October 31 amid political uncertainties.
The average turnover at the bourse declined to Tk 553.78 crore in October compared with that of Tk 740.5 crore in the previous month.
The total foreign turnover on the bourse, however, soared by 66 per cent to Tk 766 crore in October from that of Tk 459.84 crore in the previous month on heavy share sales.
The net investment by the foreign investors at the country’s premier bourse surged to Tk 1,704.94 crore in 2017 from Tk 1,340.70 crore in 2016.
Overseas investors’ turnover at the bourse was Tk 3,362.11 crore in 2010, Tk 1,904.19 crore in 2011, Tk 2,355.23 crore in 2012, Tk 2,834.90 crore in 2013, Tk 6,600.94 crore in 2014 and Tk 7,465.4 crore in 2015.
The net overseas investment at the bourse was negative Tk 767.58 crore in the year of market crash (2010).
Source: http://www.newagebd.net

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