Stocks drift lower as investors concerned

Dhaka stocks kept dipping for the second straight trading session on Sunday, as investors arrogantly reacted to the National Board of Revenue’s (NBR) recent proposal to the government for the withdrawal of tax rebates on secondary market investments for the upcoming fiscal year.

Media outlets, citing the finance ministry, carried news reports last week that the government was now contemplating removing tax rebates on investments made in the secondary stock market following the request from the exchequer.

Taxpayers, currently, are eligible for a 15 per cent rebate on their investments up to a maximum of 20 per cent of their taxable income in the stock market.

The DSEX, the benchmark index of the premier bourse Dhaka Stock Exchange (DSE), eroded 9.0 points to settle at 6,263 against 6,272 in the previous trading session.

Among other indices, the DS30, the blue-chip index, fell 4.10 points or 0.18 per cent to close at 2,190, and the DSES, the Shariah-compliant index, dropped 3.06 points or 0.22 per cent to finish the session at 1,368.

Turnover, another crucial market indicator, plunged by 20.3 per cent to Tk 636 crore against the tally of Tk 798 crore in the previous session.

The equity indices kept eroding, as cautious investors continued to offload their holdings to realise short-term gains amid macroeconomic concerns as well as the NBR proposal on tax rebate issue, creating uncertainty about the market momentum, said EBL Securities, a stockbroker. The market witnessed volatility throughout the session because investors remained active on both sides of the trading fence, with sellers taking the lead at the end of the session, it added.

The food and allied sector topped the turnover chart with a contribution of 11.6 per cent of the total turnover of the DSE, followed by IT (11.3 per cent) and textile (9.4 per cent).

Most sectors displayed dismal returns on the day, with the travel facing the highest correction of 5.6 per cent, followed by cement (2.3 per cent) and tannery (1.1 per cent). On the other hand, the general insurance secured the highest gain of 0.7 per cent.