DSE dips steeply

FE Team | Published: June 10, 2013 00:00:00 | Updated: February 01, 2018 00:00:00

FE Report Dhaka Stock Exchange (DSE) witnessed a steep fall Sunday, the first trading day after the budget announcement, as the proposed budget reportedly has fallen short of the investors' expectation. The General Index of Dhaka Stock Exchange (DGEN) ended at 4,133.60 points, shedding 167.14 points or 3.88 per cent as the market followed only one direction throughout the day without facing any resistance. AB Mirza Azizul Islam, former adviser to the caretaker government, said there was no justified logic behind the day's market fall. "Perhaps the investors' expectation was not reflected in the budget proposals," he said, adding, "Though the government offered some incentives for the stock market, the investors' expectations were too high centring the budget." One is the investment opportunity for the undisclosed money and a special fund worth Tk 50 billion, which were not among the budget proposals, he said. He also said there was no justification to increase 5.0 per cent tax of the listed mobile phone companies and tobacco manufacturing companies, which had also frustrated the investors as it would reduce their dividend- paying capacity. "The other mobile phone companies will feel discouraged from being listed in the market," he added. "The reversal resumed as budgetary expectations got neutralised. Apparently, the proposed budget for FY 2013-14 falls short of investors' expectations," commented IDLC Investments in its daily market analysis. As a result, investors couldn't rely upon holding the scrips, which had seen a sky-rocketing trend during last few weeks broadly due to the hopes centring the national budget for FY 2013-14, said the merchant bank. "Turnover also declined significantly from the previous session as investors largely followed 'Buy on Rumour, Sell on News' strategy as the recent trend," the IDLC analysis added. "With the cluster of negativity suddenly showing strong signs to prevail, the market needs to recover its liquidity as quickly as possible," stated Zenith Investments. "As the sell pressure kept coming in creating steep fall throughout the day's session, the volume also dipped rapidly that might encourage investors to take positions in the upcoming sessions as a number of scrips still remain to be undervalued," said the Zenith analysis. The losers took a strong lead over the gainers as out of 281 issues traded, 256 declined, only 16 advanced and six remained unchanged at the premier bourse. All the heavyweight sectors experienced significant fall in market value along with drying up of liquidity. A sum of 75 out of 281 traded scrips lost more than 5.0 per cent. Meanwhile, a group of investors took to the street and staged demonstration in front of the DSE building protesting against the steep share price fall. They expressed their dissatisfaction with the proposed budget. "We expected a special fund in the budget, but there were no major benefits for the small investors in it," said Md Rasel, an investor.