Regulator seeks clarification from DSE on wrong data

The stockmarket regulator has sought an explanation from the Dhaka Stock Exchange on misleading trading figures that appeared on its monitor on December 4, the day the bourse started share transactions with uniform face value.
In a letter on Tuesday, the Securities and Exchange Commission asked the DSE to turn in the explanation by today.
The SEC said the share trading of 132 companies started with the uniform face value of Tk 10.
Prices of many securities increased, but indicators appeared red on the DSE monitor, meaning a price decline, which spread wrong signals among investors, according to the letter.
“Although you (DSE) were given enough time to complete the share denomination process to bring back confidence among the investors, you have failed to take necessary steps in time,” the SEC said.
On December 4, the prices of the securities, whose trading started with the uniform value, showed unusual swings.
In one case, prices jumped up 857.75 percent, while the rest showed a 90 percent fall.
“It happened because the software was not upgraded," said a DSE official.
The existing software of the DSE calculates the price movement based on the previous day's closing prices.
In a posting on its website on December 4, the DSE said: “Trading of shares or units of 131 companies or mutual funds shall start as losers and a fund as a gainer due to the denomination change to the uniform face value of Tk 10 which will remain a gainer or loser for the rest of the day.”
The 131 companies or funds traded with a face value of Tk 100, and a fund traded with a face value of Tk 1 on November 30, it said.
The Dhaka bourse suggested the investors should not take investment decisions based on the gainers and losers calculated on the previous day's closing price.
Trading of the listed companies started on December 4 with a uniform face value of Tk 10.
Meanwhile, the SEC opened an investigation into unusual trading of five brokerage houses.
The brokers are: LankaBangla Securities Ltd, PFI Securities Ltd, IDLC Securities Ltd, AIBL Capital Market Services Ltd and ICB Securities Trading Company Ltd.