Unusual swing unnerves stock investors further
Unusually high fluctuation in turnover has left investors at the Dhaka Stock Exchange with more worry after the key indicator fell nearly 50 percent yesterday.
Turnover climbed to a six-month high of Tk 600 crore on Monday, raising hopes that the market might have finally started to get the much-needed liquidity support thanks to a number of recent measures from the government.
But the hopes were dashed within 24 hours as it nosedived 49 percent to Tk 304 crore yesterday, the lowest in two and a half months.
On Monday, the turnover climbed on the back of a huge block trade and increased activity by some institutional investors as it was the last day of the month and the third quarter of the year.
On the day, stocks worth Tk 145 crore changed hands in the block market.
A block trade involves a significantly large number of equities or bonds being traded at an arranged price between two parties.
But the average trading scenario returned yesterday.
A stock broker said institutional investors are not investing although the central bank has created more room for them to put in more money.
Investors are not hopeful about the future of the market and have adopted the wait-and-see approach, he added.
On September 17, the central bank backtracked from its decision to lower the loan-deposit ratio as it looks to alleviate the sector’s ongoing liquidity crunch and facilitate lower interest rate on lending.
The Bangladesh Bank allowed banks to keep the ratio at 85 percent and Shariah-based banks at 90 percent, relieving them of the stress of bringing down the ratios to 83.5 percent by September 30.
Furthermore, the BB announced liquidity support for banks with a view to ramping up their capacity to invest in the capital market as part of a concerted effort to arrest the ongoing bear run. The decision came on September 22.
However, the stock market has not seen as much liquidity flow as expected. Instead, the turnover is reducing.
However, the DSEX, the benchmark index of the DSE, rose 1.75 points, or 0.03 percent, to stand at 4,949.39 yesterday.
Of the traded stocks, 183 gained, 113 dropped and 56 remained unchanged.
Among the major sectors, textiles exhibited the highest positive movement with a 1.1 percent gain, while non-life insurances showed negative movement, giving up 1.3 percent.
Miracle Industries topped the list of gainers advancing 9.94 percent. Mithun Knitting was the worst loser, losing 9.47 percent.
JMI Syringes became the top-traded stock with its shares worth Tk 12.16 crore changing hands, followed by Beacon Pharmaceuticals, Bangladesh Shipping Corporation, Stylecraft, and National Tubes.
Chattogram stocks also rose with the bourse’s benchmark index, the CSCX, gaining 0.34 points to finish at 9,140.01. Losers beat gainers as 98 issues declined, 123 advanced and 29 finished unchanged on the port city bourse.
