Stocks slump amid panic sales

The key index of the country's premier bourse yesterday dropped to its lowest point since August 31 due to panic sales among investors influenced by rumours and recent market trends.

The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), fell by 482 points, or 6.54 per cent, over the past 11 trading days.

"This could have had a psychological impact leading to panic among investors," said Ahsanur Rahman, chief executive officer of Brac EPL Stock Brokerage.

The DSEX shed 120 points, or 1.71 per cent, to hit 6,885 yesterday, making it the highest single-day slump since April 11, when the index lost 1.71 per cent correspondingly, he added.

Some brokers needed to sell shares in order to adjust their margin loans and as a result, the index fell massively in the last few days.

"But I think this is a good opportunity to invest since many listed companies disclosed better performances in recent times," he said.

"Many big investors could take advantage of this to increase their stake after seeing the reduction in price," Rahman added.

Turnover, an important indicator of the market, fell to Tk 1,470 crore yesterday, down from Tk 1,471 a day earlier.

"I don't see any valid reason for the massive fall aside from some rumours," said Emran Hasan, chief executive officer of Shanta Asset Management.

When the market first began its decline, it was assumed to be caused by regular corrections but now, that does not seem to be the case.

"So people are panicking, leading to the sharp fall," he added.

In the last 11 trading days, the Dhaka bourse lost Tk 27,152 crore of its capitalisation.

The DSEX lost 50 points mainly due to the fall of British American Tobacco Bangladesh (BATBC), Beximco Limited, Summit Power, and Beximco Pharmaceuticals, according to amarstock.com. Shepherd Industries topped the gainers' list, rising 9.67 per cent, followed by CVO Petrochemicals, Fu-Wang Ceramics, Sonali Paper, and Fortune Shoes.

Stocks of Delta Life Insurance traded the most, worth Tk 155 crore, followed by Beximco Limited, Fortune Shoes, Orion Pharmaceuticals, and BATBC. Olympic Accessories shed the most, losing 9.90 per cent, followed by Summit Power, Dragon Sweater, Islamic Finance, and Tung Hai Knitting.

At the DSE, 47 stocks advanced, 307 dropped and 22 remained unchanged.

The Chittagong Stock Exchange (CSE) also fell yesterday as the CASPI, the prime index of the port city bourse nosedived by 400 points, or 1.94 per cent, to 20,169.

Among 294 issues to be traded, 37 rose, 246 fell and 11 remained unchanged.