DSE index loses 346 points in 5 days, market cap falls by Tk29,000cr

The benchmark index of the Dhaka Stock Exchange (DSE) witnessed a massive downfall on Wednesday (21 August), extending its losing streak to five consecutive sessions as investors awaited developments under the new chief of the stock market regulator.

The key index of the Dhaka bourse, DSEX, plummeted by 108 points and settled at 5,607 points as against 5,715 points in the previous trading session.

The blue-chip index, DS30, also ended 45 points lower at 2,047.

EBL Securities in its daily market review said that Dhaka stocks tumbled as investors engaged in heavy sell-offs right from the start of on Wednesday's session due to uncertain market momentum.

The new leadership within the stock market regulator has yet to settle in, while the ongoing board reformation of certain companies and measures against specific influential figures have triggered fresh concerns across the trading floor, it added.

Cautious investors opted to trim their exposure to capital market investments due to dwindling confidence amidst current market volatility, causing the broad index to extend its losing streak for five consecutive sessions, EBL Securities said.

During the last five sessions, the DSEX lost 346 points, while the market capitalisation dropped around Tk29,000 crore.

Market insiders said in the four days after the political regime change, the index rose to 6,216 on 11 August from 5,216 on 4 August as large-cap stocks including Grameenphone, Robi and British American Tobacco Bangladesh surged sharply to reverse the downtrend.

As soon as the buying spree cooled down, investors preferred profit booking or reducing their cost prices, leading to a decline in the DSEX for seven of the past eight sessions.

Following the initial bullish responses, investors now want to wait until the regulatory and economic events unfold as per expectation, according to stockbrokers and analysts.

Meanwhile, market turnover slightly increased by 3.5% to Tk536 crore compared to the previous session.

On the sectoral front, banking, pharmaceuticals and food led the turnover contribution table as they accounted for 41.8%, 19.1% and 10% of the DSE turnover value, respectively.

Most sectors displayed dismal returns, out of which telecommunications, travel and paper faced the maximum corrections as their market capitalisation declined by 3%, 2.9% and 2.9%, respectively.

Out of the 394 issues traded on the DSE, 11 advanced, 371 declined and 12 remained unchanged.

Indices in the Chittagong Stock Exchange (CSE) also settled on the red terrain as the selling pressure that resumed in the previous session continued.

CSCX, the broad-based index of the port city bourse, closed 1.39% lower at 9,754 while turnover there increased by 44% to over Tk13 crore.