FE Report
The stock market witnessed the biggest single-day fall in nearly last four months Sunday, the first trading session after the presentation of the national budget for the fiscal 2011-12 in parliament.
The main market barometer, the Dhaka Stock General Index (DGEN), shed more than five per cent on the day as the market experienced a panic-sale, mainly by retail investors.
The day's trading began with a sharp declining trend which persisted throughout the day, finally shedding 313.52 points or 5.23 per cent. Banking and non-banking financial issues were the top losers on the day.
Market insiders cited varied reasons for the fall in stock prices Sunday, the first day of the non-stop 36-hour countrywide hartal called by the opposition BNP and its ally Jamaat-e-Islami, Bangladesh. Some said a panic-sale was triggered due to the government's refusal to allow the investment of undisclosed money in stocks while others said the pressure was due to profit-taking.
However, the presidents of the Dhaka and Chittagong stock exchanges while giving their reactions on the budget last Saturday said the budget has failed to live up to their expectations. They said the government should have allowed investment of undisclosed money in stock market, which, they felt, would have provided a 'big boost' to the investors.
In fact, tax rates except for that deductible at source for brokerage commission have remained unchanged. The finance minister in his budget speech announced continuation of tax exemption benefit for small investors and made it clear that mentioning of the TIN (tax identification number) would not be required for opening beneficiary owner accounts.
Despite the countrywide 36 hours hartal, the brokerage houses could ensure the quorum in time and the trading server was logged-in by over 200 brokerage houses within the scheduled time.
However, attendance of investors was thin at the brokerage houses and many investors executed buy and sell orders over telephone, said a stock broker.
The broader DSE All Shares Price Index (DSI) lost 258.12 points or 5.18 per cent to close at 4,720.28. The DSE-20 blue chip index shed 187.99 points or 4.76 per cent to close at 3754.66.
AB Mirza Aizul Islam, former finance adviser to the caretaker government, said that the market fall might have been triggered by the government's decision not to allow investment of undisclosed money in the share market.
"The investors are disappointed over the government decision and they are disposing of shares, fearing further fall," said Mr. Islam, a former SEC chairman.
However, he sounded optimistic about the market stability and said the market will come back to positive zone very soon.
Ahmad Rashid Lali, one of the directors of the DSE, said that profit taking mainly pulled the market down and institutional investors have also started unloading their portfolio ahead of 'June closing'.
"The market gained continuously for the last several days. Many investors booked profit to minimise their previous losses," he said.
On the other hand, the investors are obviously disappointed as they did not get the opportunity of investing undisclosed money, Mr. Lali added.
Most shares traded on the day tumbled. Out 259 issues traded, only five advanced and 252 declined while two remained unchanged.
Turnover also came down to Tk 5.96 billion, down by 10.51 per cent from the previous session's Tk 6.66 billion.
All the sectors lost on the day. Among the major sectors, banking issues lost 6.85 per cent, NBFIs 5.27 per cent, telecommunications 4.95 per cent, pharmaceuticals and fuel and power lost 2.78 per cent and 4.27 per cent respectively.
A total of 74.92 million shares changed hands on the day against 79.51 million in the previous session. There were 167,228, almost equivalent to that of last Thursday.
Total market capitalization of the DSE also decreased and stood at Tk 2643.02 billion against Tk 2758.90 billion in the previous session.
UCBL topped the turnover list with shares worth Tk 355.49 million changing hands.
Other turnover leaders were United Airways, National Bank, Beximco Limited, Aftab Automobiles, BSRM Steel, Peoples Leasing, Uttara Bank, Pubali Bank and MI Cement.
Only five issues gained on the day---Islamic Bank bond was the day's highest gainer it was followed by Renata, ICB AMCL First Mutual Fund, Rupali Bank.
The day's top losers included Pubali Bank, UCBL, Dhaka Bank, Al-Arafa Bank, Uttara Bank, National Bank, Jamuna Bank, Beacon Pharma, Eastern Bank and Asia Insurance.
The stock market witnessed the biggest single-day fall in nearly last four months Sunday, the first trading session after the presentation of the national budget for the fiscal 2011-12 in parliament.
The main market barometer, the Dhaka Stock General Index (DGEN), shed more than five per cent on the day as the market experienced a panic-sale, mainly by retail investors.
The day's trading began with a sharp declining trend which persisted throughout the day, finally shedding 313.52 points or 5.23 per cent. Banking and non-banking financial issues were the top losers on the day.
Market insiders cited varied reasons for the fall in stock prices Sunday, the first day of the non-stop 36-hour countrywide hartal called by the opposition BNP and its ally Jamaat-e-Islami, Bangladesh. Some said a panic-sale was triggered due to the government's refusal to allow the investment of undisclosed money in stocks while others said the pressure was due to profit-taking.
However, the presidents of the Dhaka and Chittagong stock exchanges while giving their reactions on the budget last Saturday said the budget has failed to live up to their expectations. They said the government should have allowed investment of undisclosed money in stock market, which, they felt, would have provided a 'big boost' to the investors.
In fact, tax rates except for that deductible at source for brokerage commission have remained unchanged. The finance minister in his budget speech announced continuation of tax exemption benefit for small investors and made it clear that mentioning of the TIN (tax identification number) would not be required for opening beneficiary owner accounts.
Despite the countrywide 36 hours hartal, the brokerage houses could ensure the quorum in time and the trading server was logged-in by over 200 brokerage houses within the scheduled time.
However, attendance of investors was thin at the brokerage houses and many investors executed buy and sell orders over telephone, said a stock broker.
The broader DSE All Shares Price Index (DSI) lost 258.12 points or 5.18 per cent to close at 4,720.28. The DSE-20 blue chip index shed 187.99 points or 4.76 per cent to close at 3754.66.
AB Mirza Aizul Islam, former finance adviser to the caretaker government, said that the market fall might have been triggered by the government's decision not to allow investment of undisclosed money in the share market.
"The investors are disappointed over the government decision and they are disposing of shares, fearing further fall," said Mr. Islam, a former SEC chairman.
However, he sounded optimistic about the market stability and said the market will come back to positive zone very soon.
Ahmad Rashid Lali, one of the directors of the DSE, said that profit taking mainly pulled the market down and institutional investors have also started unloading their portfolio ahead of 'June closing'.
"The market gained continuously for the last several days. Many investors booked profit to minimise their previous losses," he said.
On the other hand, the investors are obviously disappointed as they did not get the opportunity of investing undisclosed money, Mr. Lali added.
Most shares traded on the day tumbled. Out 259 issues traded, only five advanced and 252 declined while two remained unchanged.
Turnover also came down to Tk 5.96 billion, down by 10.51 per cent from the previous session's Tk 6.66 billion.
All the sectors lost on the day. Among the major sectors, banking issues lost 6.85 per cent, NBFIs 5.27 per cent, telecommunications 4.95 per cent, pharmaceuticals and fuel and power lost 2.78 per cent and 4.27 per cent respectively.
A total of 74.92 million shares changed hands on the day against 79.51 million in the previous session. There were 167,228, almost equivalent to that of last Thursday.
Total market capitalization of the DSE also decreased and stood at Tk 2643.02 billion against Tk 2758.90 billion in the previous session.
UCBL topped the turnover list with shares worth Tk 355.49 million changing hands.
Other turnover leaders were United Airways, National Bank, Beximco Limited, Aftab Automobiles, BSRM Steel, Peoples Leasing, Uttara Bank, Pubali Bank and MI Cement.
Only five issues gained on the day---Islamic Bank bond was the day's highest gainer it was followed by Renata, ICB AMCL First Mutual Fund, Rupali Bank.
The day's top losers included Pubali Bank, UCBL, Dhaka Bank, Al-Arafa Bank, Uttara Bank, National Bank, Jamuna Bank, Beacon Pharma, Eastern Bank and Asia Insurance.
No comments:
Post a Comment