Stocks bleed upon fear of political tension
Stock market investors continue to dread political tension centring on the upcoming national election and in the process bleed money, with the key index of the Dhaka Stock Exchange sinking for the fourth straight day yesterday.
DSEX, the benchmark index of the DSE, dropped 14.05 points, or 0.27 percent, yesterday to close at 5,224.94 points, meaning Tk 4,708.14 crore was shed in market capitalisation since Wednesday.
Investors lost Tk 45,813 crore since the turn of the year, when the index was at 6,280 points.
“Institutional and big individual investors are not active in the market now,” said the chief of a bank's stock market wing.
The most-traded stocks led the losses on the Dhaka Stock Exchange yesterday.
Khulna Power Company, which topped the turnover list on three of the four days, lost 25.06 percent of its market value during the period. United Power Generation, another top-traded stock, shed 10.85 percent.
Most of the blue-chip shares, banks and non-bank financial institutions also witnessed fall during the period because of drop in profits, which disappointed the market.
A top official of a merchant bank said the most-traded companies and blue-chips are normally chosen by institutional and foreign investors.
“So, if they become inactive these stocks suffer,” he said.
Institutional investors are observing the situation while the participation of foreign investors is also becoming thin due to fear of political uprising ahead of the parliamentary polls.
“All these have affected the market,” said the merchant banker.
The downward trend in the market began with the liquidity crisis, said Mizanur Rahman, a stock market analyst.
The liquidity crisis is yet to be solved and the way the government tried to deal with the issue has made it worse, said Rahman, also a professor of Dhaka University.
Turnover, another important indicator of the stock market's vitality, rose 1.6 percent to Tk 538.20 crore.
Khulna Power was the top traded stock with 31.12 lakh shares worth Tk 29.26 crore changing hands, followed by Saiham Textile, Nurani Dyeing, Intech and Dragon Sweater.
ISN, which announced divided just the day before after a gap of five years, was the day's best performer, posting a 9.97 percent gain, while Khulna Power was the biggest loser, shedding 9.76 percent.
Losers outnumbered gainers by 153 to 125, while 61 securities remained unchanged.
The Chittagong Stock Exchange also fell with its key index declining 35.43 points to finish at 9,711.76.
The port city bourse traded 71.89 lakh shares and mutual fund units worth Tk 20.78 crore.
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