Stocks extend losing streak amid confidence crisis

FE ONLINE DESK | Wednesday, 25 May 2022

Stocks extended losing streak for the second straight day on Wednesday, despite the regulatory efforts to revamp the ailing market, amid a confidence crisis among investors.

Following the previous day’s losing streak, the market opened lower and moved positive and negative several times before ending marginally lower.

DSEX, the key index of Dhaka Stock Exchange, went down by 23.81 points or 0.38 per cent to settle at 6,187. DSEX lost 74 points in the past two straight sessions.

Two other indices also ended lower. The DS30 index, comprising blue chips, fell 7.06 points to finish at 2,287 and the DSE Shariah Index (DSES) shed 3.82 points to close at 1,363.

Turnover, a crucial indicator of the market, also came down below Tk 6.0 billion mark again and amounted to Tk 5.13 billion, which was 22 per cent lower than the previous day’s tally of Tk 6.60 billion.

The market ended lower in the last 10 trading days out of 11. The index gained 118 points on Monday and before that the stock index lost 556 points in eight consecutive days which prompted the government to intervene in the market to bring back investors' confidence in the market.

The Bangladesh Securities and Exchange Commission raised the margin-loan ratio to 1:1 while the finance ministry asked to extend the tenure and amount of the capital-market refinancing fund to support the moribund market, but virtually failed to sustain the momentum amid increased sale pressure from the investors, market insiders said.

“Despite the regulatory intervention, the confidence of investors is yet to restore as uncertainties persist due to the un-abating Russia-Ukraine war and instability in the global commodity market,” said a merchant banker, seeking anonymity.

Soaring inflation and further devaluation of local currency might hurt investors’ sentiment further, he said.

Out of 375 issues traded, 250 declined, 76 advanced and 49 issues remained unchanged.

Beximco continued to dominate the turnover chart with shares worth Tk 464 million changing hands, followed by IPDC Finance, Shinepukur Ceramics, JMI Hospital Requisite Manufacturing and Fortune Shoes.

The Chittagong Stock Exchange (CSE) also ended lower with the CSE All Share Price Index (CASPI) shedding 120 points to settle at 18,162 and its Selective Categories Index (CSCX) losing 72 to close at 10,896.

Of the issues traded, 187 declined, 51 advanced and 30 issues remained unchanged on the CSE trading floor.

The port-city bourse traded 6.95 million shares and mutual fund units with turnover value of Tk 151 million.

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