DSE turnover hits record low
A dearth of liquidity takes a heavy toll on the premier bourse's turnover or transaction value that hit its lowest yesterday in eight months.
It came on top of a continued free fall in share prices.
The single-day turnover on the Dhaka Stock Exchange came down to Tk 969 crore yesterday, 6 percent lower than the previous day's and 70 percent lower than the highest-ever single-day turnover of Tk 3,249 crore a month ago.
The market is facing the liquidity crisis mainly due to the monetary tightening measures taken by the central bank to curb inflation. As a result, the institutional investors are going through a shortage of funds, while the lenders cannot provide credit.
"Many investors were not confident enough to put in fresh funds. The market felt sales pressure from the investors who were sitting on profit," said LankaBangla Securities in an analysis.
It said the credit providers could not extend additional loans to the clients because of costly borrowing. "Institutions sat idle due to expensive liquidity in the money market and are reluctant to overexpose to the stockmarket due to tight surveillance of the watchdog."
"The bearish trend is expected to be chronic if the market does not get liquidity support," LankaBangla said.
The market went down for the fourth consecutive session yesterday, with the benchmark index of the Dhaka bourse -- DSE General Index (DGEN) -- suffering a loss of 212 points to 7,735. In the last four trading days, the DGEN slumped by 570 points.
The continuous slump also prompted the retail investors to take to the streets yesterday for a second day in a row.
Police detained at least six people in front of the Dhaka bourse and the adjacent areas on charge of street vandalism during a demonstration.
Chittagong stocks also suffered a big loss yesterday, with the CSE Selective Categories Index sliding by 323 points to 14,193.
The single-day turnover on the Chittagong Stock Exchange also plummeted by 22 percent to Tk 94 crore.