DSEX sinks 3.13%, wipes out Tk13,500cr in market cap last week

Infographic: TBS

The benchmark index DSEX of the Dhaka Stock Exchange (DSE) dropped 3.13% last week, following stringent regulatory actions against market manipulators and non-compliant firms.

The regulatory actions sparked a significant sell-off, intensifying the sharp decline. During the five trading sessions last week, the DSEX tumbled on four days, with gains recorded on just one. As a result of this downturn, the market capitalisation shrank by Tk13,500 crore.

Last week, the DSEX lost 176 points to close at 5,462, while the blue-chip index DS30 declined by 74 points to settle at 1,990.

Investors' participation in the market also fell by 37% to Tk426 crore compared to the previous week.

Among the traded stocks, 57 advanced, 331 declined and 8 remained unchanged.

EBL Securities said in its weekly market review that the capital market of the country logged extreme hurdles last week, with investors bearing the brunt of intense bearish sentiment across the trading floor triggered by the abrupt regulatory measures and policy changes coupled with rising interest rates in the money market.

The market experienced a massive selling spree as unnerved investors preferred to trim their equity exposures to avoid further losses amid uncertain market momentum, compelling the benchmark index to decrease by 132 points in a single session, the sharpest fall in 30 months, it added.

However, bargain hunters emerged to take positions on certain beaten-down scrips in the last trading sessions of the week, providing a cushion to the market's free fall, read the EBL Securities report.

Following the massive downfall, hundreds of retail investors who had blocked the Motijheel roads on Wednesday marched to the Bangladesh Securities and Exchange Commission (BSEC) building in Agargaon around midday, demanding the resignation of the new BSEC chairman, Khondoker Rashed Maqsood, for his "investor-unfriendly regulatory stances."

They rejected the regulator's call for dialogues and locked the main gate of the BSEC building Thursday.

Police assuring them of a meeting with the finance adviser of the interim government on Sunday managed to free the BSEC officials.

Maqsood was appointed as the BSEC chairman on 18 August and he announced no repetition of irregularities in the stock market promising good governance and reforms.

However, sending 27-28 deserving firms to the Z category at the end of last month added to the selling pressure, while a record fine imposed on nine manipulators of Beximco shares shook market makers in the concluded week.

Meanwhile, investors were mostly active in the bank sector, followed by the pharma sector, and the fuel-power sector.

Sectors ended in red with the paper sector being the biggest loser.

Junk stock Bangladesh Industrial Finance Company (BIFC) led the gainers' table last week, with its share price soaring over 32%. In contrast, Linde Bangladesh emerged as the worst performer of the week.