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Dhaka stocks sagged this week as a recent regulatory restriction on purchasing stocks before bank cheque encashment cast a shadow over investors’ sentiment along with concerns over the dismal macroeconomic outlook.
The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), plunged 101.95 points or 1.57 per cent to settle at 6,392 as investors reacted negatively to the regulator’s recent stock purchase restriction against bank cheques.
Among other indices, the DS30, the blue-chip index, suffered 30.41 points or 1.32 per cent to 2,277 and the DSES, the Shariah-based index, fell 12.67 points or 0.89 per cent to close at 1,407.
Meanwhile, the average turnover fell by 3.97 per cent to Tk 1,160 crore in the premier bourse.
The pharmaceutical sector topped the turnover chart with a contribution of 18.57 per cent to the total turnover.
The market performed five sessions this week.
The market started on a negative note by suffering 0.24 per cent on Sunday, and remained negative with a loss of 1.01 per cent on Monday.
It continued the downward momentum on both Tuesday and Wednesday.
The market, however, closed on a positive note with a gain of 0.03 per cent on Thursday, the last trading session of the week.
All the financial sectors registered negative performance this week.
Of them, the general insurance sector suffered the most by giving up 2.53 per cent, followed by NBFI (1.12 per cent), life insurance (0.68 per cent), bank (0.2 per cent), and mutual fund (-0.03 per cent), according to BRAC EPL’s weekly market review.
Investors reacted negatively to the regulator’s recent restriction on purchasing stocks before bank cheque encashment, the prime reason that pulled down the stocks, fueled by bleak macroeconomic outlook, said EBL Securities, a stockbroker, in its weekly market review.
Besides, the market was concentrated on a handful of stocks, while a majority of scrips were stuck at their floor prices without having potential buyers, which had damaged investors’ confidence regarding the market outlook, it added.
The equity indices of the Dhaka bourse recorded consecutive corrections throughout the week as investors chose to partially liquidate their holdings and reshuffle their portfolios, owing to a bleak expectation from the upcoming corporate declarations, EBL Securities commented.
On the sectoral front, jute, paper and printing, and food and allied sectors closed positive this week while travel and leisure, services and real estate, and cement sectors faced corrections.
On October 2, the stock market regulator Bangladesh Securities and Exchange Commission (BSEC) asked stockbrokers not to buy shares against bank cheques before encashment.
The BSEC also asked the stock exchanges to take necessary steps to this end in line with a circular issued on December 6, 2010.
On October 10, the bourses notified all stockbrokers and asked them to comply with the BSEC order.
Previously, stockbrokers allowed their clients to instantly buy shares against their (clients) bank cheques without verifying whether the bank accounts had money or not.
The market had plunged by 467 points in two days after the issuance of the circular on December 6, 2010.
Following that backlash, the BSEC suspended the move just two days after the issuance of the circular, and the market recovered by 129 points on the following day.
Out of the 397 issues traded, 41 stocks advanced, 171 scrips declined, and 174 issues did not see any price movement on the trading floor of the Dhaka bourse this week.
ADN Telecom was the week’s top gainer, soaring by 25.55 per cent, while BDCom Online was the worst sufferer by giving up 49 per cent of its stock price.
The port city bourse, Chittagong Stock Exchange (CSE), also closed lower this week with its two major indices — the CSCX and the CASPI — declining by 1.62 per cent and 1.6 per cent respectively.
Out of the 298 issues traded, 38 advanced, 129 declined, and 131 remained unchanged on the CSE this week.
