Stocks fall amid worries over economy

Image collected : dse and cse logo
Dhaka stocks declined on Monday as investors went for selling shares amid concerns over the country’s economy and foreign portfolio investment at the capital market.

The key index of Dhaka Stock Exchange, DSEX, shed 0.71 per cent, or 33.72 points, to close at 4,678.36 points on Monday after gaining 29.18 points in the previous day.

The market started falling from the beginning on Monday and descended more strongly as the session progressed as investors went for selling shares amid worries over the county’s economy and foreign portfolio fund exodus.

The Centre for Policy Dialogue on Sunday said the macroeconomic stability in the country had now become weaker and performance of economic indicators was under mounting pressure that might lead to a structural slowdown in the economy.

Concerning the country’s stock market, the CPD identified five institutional and governance related weakness — poor quality initial public offerings, anomalies in financial reporting, lack of transparency in BO accounts, suspicious trading at secondary market and questionable role of institutional investors.

Besides, the foreign investors have been continuously withdrawing funds from the capital market, making the situation worse.

The media reported that the foreign investors at the DSE withdrew record Tk 777 crore in last eight months (March-October) this year.

In October, the overseas investors sold shares worth Tk 328.92 crore against their purchase of shares worth Tk 231.99 crore.

EBL Securities in its daily market commentary said, ‘Market volatility still haunts investors. In fear of making loss, investors are reluctant to inject fresh fund in the market. Amidst depressed market outlook and devaluation of local currency, the foreign investors kept on liquidating their investments,  which worsen the situation of the overall market ambience.’

The relentless fall in the market provoked investors to withdraw funds to save their investments from further erosion.

The DSEX lost 1,273 points in last nine months with the bourse’s market capitalisation declining by around Tk 64,200 crore.

Besides, a number of companies declared poor earnings and dividends that worsened the situation.

Around 20 listed companies declared no dividend for the year ending June 30, 2019 that dampened investors’ mood.

Share prices of Grameenphone dropped in last seven days as investors saw no hope of an immediate solution to the mobile operator’s audit claim dispute with the Bangladesh Telecommunication and Regulatory Commission.

Share prices of GP declined by 0.35 per cent on Monday.

The average share prices of almost all the sector dropped on the day.

Share prices textile, energy and telecommunication dropped by 1.58 per cent, 0.66 per cent and 0.64 per cent respectively.

Turnover on the DSE plunged to Tk 269.03 crore on Monday from Tk 325.97crore in the previous day.

Share prices of large capitalised companies like British American Tobacco, Grameenphone, United Power Generation Company and Square Pharmaceuticals dropped on Monday.

Out of the 353 scrips traded on the day, 242 declined, 78 advanced while 39 remained unchanged.

DSE blue-chip index DS30 lost 0.71 per cent, or 11.74 points, to close at 1,626.60 points.

Shariah index DSES shed 0.79 per cent, or 8.62 points, to end at 1,074.55 points.

National Tubes led the turnover chart with its shares worth Tk 12.87 crore changing hands on the day.

Northern Jute, Standard Ceramics, VFS Thread Dyeing, Stylecraft, Fortune Shoes, Sonar Bangla Insurance, Premier Bank and Khulna Power Company were the other turnover leaders.

Appollo Ispat Complex gained the most on the day with a 6.81-per cent increase in its share prices while Western Marine Shipyard performed the worst, losing 12 per cent.
Source: http://www.newagebd.net

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