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DSEX crashes to 11-month low

The index extends losses for 8th straight session for first time in 4-year
Staff Correspondent
23 May 2022 00:00:00 | Update: 23 May 2022 07:41:50
DSEX crashes to 11-month low

The Dhaka Stock Exchange (DSE) witnessed yet another massive selling pressure on Sunday with the benchmark DSEX index plunging to an 11-month low.

The market began its slide soon 10 minutes after opening at 6,268, with the benchmark index down 130 points by midday. The index closed at 6,142, down 115 points, or 1.8 per cent—a level not seen since June 29, 2021 when it was 6,042.

Sunday’s plunge surpassed the previous record for the biggest single-day fall, when the market had registered a fall of 135 points on April 16, 2022.

With the plunge, the index extended its losing streak for the 8th consecutive session for the first time in four years since April 30, 2018, when the index dropped for the 13th consecutive session from April 30 to May 20, 2018.

In eight days, it lost 555 points during the period.

Brokers cited the widening trade deficit as the reason behind the plunge, saying it will keep taka under pressure further.

The downturn in the market may be treated as an opportunity, they said.

Meanwhile, the US dollar soared to Tk 87.5 in the interbank market after gaining Tk 70 in value in a week.

“Indices in the Dhaka bourse nosedived amidst intense selling pressure, mirroring a meltdown in world equities as investors braced for slowing global growth amid policy tightening by central banks,” said EBL Securities in a note.

The country’s stock market has plummeted as investors were concerned about rising commodities prices and the taka’s declining value against the dollar, it said.

Followed by a panic-driven sell frenzy, the regulator has temporarily suspended the 15-minute pre-opening session to avoid misuse of the feature, it added.

Out of the 385 issues traded, 21 advanced, 345 declined, and 19 remained unchanged.

The port city bourse, CSE, also settled in red terrain. The selected indices (CSCX) and All Share Price Index (CASPI) have declined by 217.1 and 362.0 points respectively.

The government data showed trade deficit rose steeply by 9.25 per cent to $25 billion in the first nine months to March of this fiscal year, driven largely by an increase in imports compared to exports from the country.

Earlier, data released by the Bangladesh Bureau of Statistics showed inflation shot up to 6.29 per cent in April—the highest increase noted in the past 18 months influenced by a record hike in edible prices.

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