Dhaka stocks on Monday nosedived for the second consecutive day, stretching the current bear run to a four-day one, with investors continuing with heavy sell-offs as the government had done nothing yet to bail the capital market out of the prolonged liquidity crunch and driven by panic created by rumours about inclusion of tax measures for the equities market in the forthcoming national budget.
The general index, or DGEN, of Dhaka Stock Exchange took a 135.89-point or 2.46 per cent plunge to close the day at 5,376.30 points.
The DGEN had lost a total of 415 points in the past four trading days in the latest debacle as the investors went for blanket sell-off, considering the finance minister’s recent remark about providing no opportunity for whitening and investing undisclosed money in the capital market as a warning and also from their scepticism about the market’s potential to rebound.
The finance minister, Abul Maal Abdul Muhith, recently said there would be no scope in the forthcoming budget to whiten undisclosed money.
The Dhaka and the Chittagong bourses in a meeting with the finance minister on Sunday made strong pleas for allowing an opportunity for whitening and investing undisclosed money in the securities market hit hard by a liquidity crisis but Muhith turned them down.
Market operators said general investors were also apprehending that the government might impose tax on capital gain and make taxpayer’s identification numbers mandatory for opening and maintaining beneficiary owner’s accounts. And as the finance minister did not reject such moves, they became panicked.
‘As the finance minister did not give any hope or deny the possibility of imposing capital gain tax, general investors went for heavy sell-offs,’ said a stockbroker.
He also said the delay in restructuring the Securities and Exchange Commission, which had made the capital market regulator dysfunctional, was also having a negative impact on the market.
Turnover of the DSE on Monday also dropped to Tk 344.04 crore from that of Tk 440.67 crore on Sunday.
Of the 259 issues traded on the day, 210 declined, 39 advanced, and three remained unchanged.
The market on Monday started upbeat as the DGEN gained around 60 points in the first 15 minutes. But the gaining streak faded fast as the index lost around 85 points over the next half an hour. Although the DGEN curve moved upward time to time, the index ended the day in red.
After the DGEN took a 135-point plunge on Monday preceded by the 205-point nosedive the day before, experts said the government should come up with an immediate announcement about its planned tax measures for the capital market to clear the confusion of the investors.
AIMS Bangladesh Ltd managing director and chief executive officer Yawar Sayeed said, ‘The investors cannot see any ray of hope that the market would turn positive and thus are becoming more and more panicky.’
‘The government and the SEC should come up with immediate measures to address the ongoing vulnerability and clear the confusion of the investors,’ he said.
The general index, or DGEN, of Dhaka Stock Exchange took a 135.89-point or 2.46 per cent plunge to close the day at 5,376.30 points.
The DGEN had lost a total of 415 points in the past four trading days in the latest debacle as the investors went for blanket sell-off, considering the finance minister’s recent remark about providing no opportunity for whitening and investing undisclosed money in the capital market as a warning and also from their scepticism about the market’s potential to rebound.
The finance minister, Abul Maal Abdul Muhith, recently said there would be no scope in the forthcoming budget to whiten undisclosed money.
The Dhaka and the Chittagong bourses in a meeting with the finance minister on Sunday made strong pleas for allowing an opportunity for whitening and investing undisclosed money in the securities market hit hard by a liquidity crisis but Muhith turned them down.
Market operators said general investors were also apprehending that the government might impose tax on capital gain and make taxpayer’s identification numbers mandatory for opening and maintaining beneficiary owner’s accounts. And as the finance minister did not reject such moves, they became panicked.
‘As the finance minister did not give any hope or deny the possibility of imposing capital gain tax, general investors went for heavy sell-offs,’ said a stockbroker.
He also said the delay in restructuring the Securities and Exchange Commission, which had made the capital market regulator dysfunctional, was also having a negative impact on the market.
Turnover of the DSE on Monday also dropped to Tk 344.04 crore from that of Tk 440.67 crore on Sunday.
Of the 259 issues traded on the day, 210 declined, 39 advanced, and three remained unchanged.
The market on Monday started upbeat as the DGEN gained around 60 points in the first 15 minutes. But the gaining streak faded fast as the index lost around 85 points over the next half an hour. Although the DGEN curve moved upward time to time, the index ended the day in red.
After the DGEN took a 135-point plunge on Monday preceded by the 205-point nosedive the day before, experts said the government should come up with an immediate announcement about its planned tax measures for the capital market to clear the confusion of the investors.
AIMS Bangladesh Ltd managing director and chief executive officer Yawar Sayeed said, ‘The investors cannot see any ray of hope that the market would turn positive and thus are becoming more and more panicky.’
‘The government and the SEC should come up with immediate measures to address the ongoing vulnerability and clear the confusion of the investors,’ he said.
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