Stocks slump, turnover hits 11-month low

Bangladesh's stocks fell yesterday amidst thin participation of both retail and institutional investors with the turnover at Dhaka Stock Exchange (DSE) touching the lowest in 11 months.

The benchmark index, DSEX, shed 67.55 points or 1 per cent to close at 6,698.04 yesterday. All the indices of Chittagong Stock Exchange (CSE) declined too.

Turnover slumped 26 per cent to Tk 616 crore yesterday at the main bourse of the DSE from Tk 835 crore the previous trading day.

Yesterday's turnover was the lowest since April 18 last year when it was Tk 602.7 crore, according to the DSE data.

Market participants said a number of large investors stayed aloof for a 2 per cent cap on share price freefall imposed by the Bangladesh Securities and Exchange Commission earlier this month.

The restriction came in the wake of apprehensions of what effects the Russia-Ukraine war would have on the economy.

Besides, participation of institutional investors were low because of demand for funds for implementation of annual development programmes by the government agencies.

Other factors included a lack of injection of fresh funds by retail investors ahead of Ramadan, the month of fasting.

"Historically, a bearish trend prevails in the market in the March to April period of the year," said Ershad Hossain, CEO of City Bank Capital Resources.

Yesterday, all the indices at the DSE declined as all sectors with large market capitalisation incurred losses.

Non-bank financial institutions experienced the highest loss of 1.69 per cent followed by food and allied (1.29 per cent) and fuel and power (0.90 per cent), said BRAC EPL Stock Brokerage in its daily market update.

Engineering, bank, pharmaceutical and telecommunication stocks also declined.

"It appears that institutional investors remained in the sidelines for now. They are in a wait-and-see mood," said a chief executive of a brokerage firm seeking to remain unnamed.

Mohammad Emran Hasan, chief executive of Shanta Asset Management, said the market dipped amid uncertainty and panic over the possible fallouts of the Russia-Ukraine war on the Bangladesh economy, particularly inflation.

"There has been an overreaction in the market although the market is not overvalued," he said.

At the DSE, Beximco topped the list as the share to be traded the most yesterday, recording a Tk 53.5 crore turnover.

Takaful Insurance gained the most followed by Hwa Well Textiles (BD). IFIC Bank and Shahjalal Islami Bank were the top losers at the DSE.

Of the 379 shares traded yesterday, only 23 advanced.