Stocks take a steep dive

The local stock market witnessed a massive fall yesterday, marking the sixth consecutive day that the prime index of the country's premier bourse has seen a downward trend.

The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), nosedived by 89 points, or 1.24 per cent to hit 7,097.

The index had fallen by a total of 270 points, or 3.66 per cent, over the preceding five days.

"However, this dip follows the massive hike in market value witnessed in the past six months and so, some profit booking is to be expected," said Mohammad Emran Hasan, chief executive officer of Shanta Asset Management Company.

"This is a regular phenomenon," he added.

Besides, if the country's macroeconomic indicators remain positive and the performance of listed companies is good, then the stock market will bounce back.

"There is huge liquidity in the market which will be invested in stocks because there is no other high return generating alternative investment scope," Hasan said.

Turnover at the Dhaka bourse fell 15 per cent to Tk 1,393 crore yesterday, down from Tk 1,655 crore a day earlier.

At the DSE, 33 stocks advanced, 324 fell and 17 remained unchanged.

Golden Son topped the gainers list, rising by 9.75 per cent, followed by SBAC Bank, BSRM, Sonali Paper, and National Housing Finance.

Meghna Condensed Milk shed the most, losing 9.18 per cent, followed by Beach Hatchery, Dacca Dyeing, Savar Refractories and Usmania Glass.

Stocks of Orion Pharmaceuticals traded the most, worth Tk 89 crore, followed by Delta Life Insurance, LafargeHolcim Bangladesh, British American Tobacco (BATBC), and Fortune Shoes.

The index dropped around 36 points collectively for the fall of BATBC, the biggest contributor, Grameenphone, Walton Hi-tech Industries, Square Pharmaceuticals, and the Investment Corporation of Bangladesh.

Among major sectors, the paper and printing, and tannery sectors experienced price appreciation while the services and real estate, non-bank and textile sectors faced correction, according to a daily market review by UCB Stock Brokerage.

On condition of anonymity, a senior official of a merchant bank said that some institutional investors sold-off a massive amount of shares to adjust their capital market exposure.

"But this situation will not continue for long and so, the market will bounce back soon," he added.

The Chittagong Stock Exchange (CSE) also dropped yesterday as the CASPI, the general index of the port city bourse, edged down 314 points, or 1.49 per cent to 20,707.

Among the traded 307 stocks, 35 rose, 257 fell and 15 remained unchanged.