DSEX dips below 4,000-mark

The prime index of Dhaka Stock Exchange (DSE) went below the major ‘psychological’ threshold of 4,000-mark for the first time in 18 months as frustrated investors went for heavy sell-offs.

Selling pressure mounted on Motijheel Street straight from the early trading as bunch of corporate declaration came up with dismal performance, which made the investors more frustrated, brokers said.

Some investors also alleged that several brokerage houses made forced sale which triggered the steep fall.

DSEX, the benchmark Index of DSE, the yardstick of the premier bourse, plunged 87.54 points or 2.16 per cent to close at 3,959.73 points -- which was a 18-month low since October 30, 2013.

DSEX suffered a loss of about 905 points or 18.6 per cent – January 1 to May 4 -- as the bearish trend continued except few trading sessions.

The two other indices also saw sharp fall. The DS30 index, comprising blue chips, plummeted 39.48 points or 2.55 per cent to close at 1,505.70 points. The DSE Shariah Index (DSES) dropped 19.08 points or 1.92 per cent to close at 973.45 points.

Turnover, the most important indicator of the market, came down to Tk 3.30 billion, registering a decline of 14 per cent from the previous session session’s Tk 3.82 billion.

The market analysts said the country’s overall economic situation, lack of investor confidence, concern of political unrest, ongoing liquidity shortage and relatively ‘poor’ performance reported by most of companies in their quarterly reports influenced the recent fall.

“Most institutional investors remained inactive, as a result of which small investors went for panic sell-offs to save money what they have rest,” said an analyst adding that the investors, mostly retail ones, are now looking for exit doors while big players remain in the sideline.

The presence of investors at the brokerage houses was also thin because of the ongoing pessimism which started from January this year and pushes investors’ confidence to the brink.

LankaBangla Securities, a stock broker, said, “The market saw sharp cuts, dragged down by bank, textile and oil and gas stocks”.

“Poor performance by most of the companies in March quarter earnings wrecked investor sentiment,” said the stock broker.

Investors is going through the earnings season and looking for companies that show some sort of visibility. However, few large dividend declaring stocks stood out in the market, said the stock broker.

“Lower earning disclosures resulting from first quarters’ political blockade soared pessimism and brought another collapse across the market, snatching 87.5 points off of DSEX,” said IDLC Investments, a merchant bank, in an analysis.

Investors remained hooked to selling off their positions amid growing level of fear, said the merchant bank.

All the major sectors closed lower. Cement registered the highest loss of 3.78 per cent. Power witnessed correction of 2.26 per cent. In the financial sector, NBFIs went down by 1.86 per cent and banks also closed lower by 1.08 per cent.

Pharmaceuticals retraced by 0.85 per cent. Food and allied and telecommunication lost 0.46 per cent and 0.41 per cent respectively.

The losers took a strong lead over the gainers as out of 305 issues traded, 218 declined, 68 advanced and 19 remained unchanged on DSE trading floor.

Activities decreased in the major bourse where trade and volume were down by 21.47 per cent and 27.39 per cent respectively. A total number of 0.099 million trades were executed with trading volume of 81.57 million securities.

The market capitalisation stood at Tk 2,934.73 billion against Tk 2,973.46 billion in the previous session.

United Power Generation & Distribution Company continued to dominate the top turnover chart with shares worth Tk 349.75 million changing hands followed by ACI Formulations, ACI, Square Pharma and Lafarge Surma Cement.

In Tech Online was the day’s top gainer, posting a rise of 31.25 per cent while BSRM was the worst loser, plunging by 21.36 per cent.

The port city bourse, Chittagong Stock Exchange (CSE) also closed lower with its Selective Categories Index – CSCX – fell 115.16 points to close at 7,433.81 points.

Losers beat gainers 154 to 44, with 22 issues remaining unchanged at the port city bourse that traded 6.29 million shares and mutual fund units, turnover value of Tk 250.57 million.

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