Stocks down on credit crunch

A credit crisis and lack of confidence pulled down twin bourses yesterday as investors went on a sell-off spree for a third day.
The benchmark general index of Dhaka Stock Exchange (DGEN) shed 217 points, or 3.6 percent, closing at 5,800 points yesterday. The index had lost 587 points all together in three days of trading on the DSE.
The selective price index of Chittagong Stock Exchange also declined 415 points, or 3.8 percent, to close at 10,558 points.
Small and big investors, including institutional ones, faced a credit crisis as the daily turnover dropped on the closing day of the week. The daily turnover on the prime bourse stood at Tk 559 crore, down by Tk 14.42 crore from the previous day.
Insiders said the losing trend was a sign of severe volatility that has been prevailing in the market for two months. Most of the institutional investors, including merchant banks, failed to buy shares amid credit crisis, they added.
Most investors opted to leave the market as they anticipated another debacle arising from the selling pressure of investors, added insiders.
State-owned companies do not have enough fund to go for massive buying of shares to stabilise the market, said a stockbroker. Small investors lost confidence as the some big institutional investors followed 'wait and see' approach despite having funds, he added.
The DSE general index started the day on red alert as most of the institutional investors went for big selling, said a market operator.