Telecoms, banks lead stock dive

Stocks tumbled yesterday amid sell-offs in almost all sectors, with telecoms and banks taking the lead.
The fuel and power and cement sectors backed the biggest slump in the previous sessions since March 14, with turnover diving to the lowest point of Tk 593 crore in the year amid a lack of participation by both retail and institutional investors.
The benchmark DGEN or DSE General Index slumped 70.62 points or 1.26 percent to 5502.74 -- the biggest decline since March 14, when the main index DGEN tumbled 124.76 points or 2.27 percent.
The DSI or All Shares Price shed 58.30 points or 1.27 percent to reach 4505.79. The DSE-20 blue chip index lost 30.89 points or 1.06 percent to 2858.32.
Analysts linked the fall in indices and turnover to factors such as uncertainty in the regulatory environment and possible tax incidence in the upcoming budget.
Confusion over TIN number requirements for beneficiary owner account holders along with the Bangladesh Bank restriction on commercial banks' investment in stocks also contributed to the fall. It dampened investor sentiment with many maintaining a wait-and-see approach.
Of the issues traded, 77 advanced, 164 dropped and seven finished unchanged.
“The reduction in volume is most likely driven by sentiments of the retail investors joining the institutional investors to take a wait and see approach,” Reaz Islam, chief executive of LR Global Bangladesh (AMC).
He however observed that the market is in the midst of a correction. “It is healthy for long term stability, and this is expected after a bull run that started in mid 2009,” he added.
Hasan Imam, chief executive of RACE Asset Management, observed there is a lack of dividend and earnings related news in the market to stimulate buyers as most banks have announced dividends.
Operators said a section of institutional investors, along with retailers, offloaded their holdings in the banking sector while profit taking shares of Grameenphone, the market heavyweight, led it to end lower.
Top most issue on the turnover board Grameenphone lost 2.29 percent to reach Tk 361.60 after gaining in the previous five consecutive sessions.
Pubali Bank, City Bank and AB Bank guided the fall in the banking sector, while Summit Power, second top share on the turnover board, slipped for the second day to Tk 1,401.25, down by 1.18 percent from a day ago.
The pharmaceuticals sector ended downbeat for an eighth day, led by Square Pharma. Square Pharma declined 0.85 percent to Tk 3,490.50. Beximco Pharma finished almost flat.
The cement sector ended lower due mainly to fall in Lafarge Surma after it said its board had not recommended any dividend for the year 2009.
Lafarge plummeted 3.53 percent to Tk 436.75.
All the indices on the Chittagong Stock Exchange fell.