Dhaka stocks see yet another free fall

FE Report Dhaka stocks experienced yet another massive fall Tuesday, as its main index lost 225.53 points. The DGEN, main gauge of the country's premier bourse, plunged more than four per cent, as the investors went for heavy panic sale, fearing further instability and uncertainty in the market. Market insiders said the investors are selling off their shares of panic, as consecutive measures taken by the market regulator and stakeholders frequently failed to stabilise the market. "Today's fall was due to panic sale amid lack of confidence among investors, as there is no hope in sight for an immediate end to the market's downward spiral," said an analyst. The market started with free fall at opening session and index plunged more than 50 points within five minutes. The downtrend continued throughout the session due to severe liquidity crisis and panic sale and finally closed 225.53 points lower. The benchmark General Index of the Dhaka Stock Exchange, DGEN, plunged 225.53 points or 4.08 per cent to close at 5,293.31, which was five and a half months' low since May 25. On that day, the DGEN was 5,292.53. The broader All Shares Price Index (DSI) dipped 188.11 points or 4.06 per cent to close at 4,4472. The DSE-20 Index comprising blue-chip shares also plummeted 112.16 points or 2.90 per cent to close at 3,743.16. Market analysts said the market is falling continuously as small investors' confidence is eroding day-by-day and they want to come out of the market by selling their stocks anyway following the ongoing bearish trend. "The investors are looking for ways to come out of the market anyhow and for that reason they are selling off their shares hastily," commented an analyst. Institutional investors are yet to become active in the market, as some groups are possibly trying to push the market down, so that they can later buy shares at lower prices, he mentioned. At present the flow of liquidity from the institutional investors is very much important to stabilise the market as well as restoring investors' confidence, he said. The market might lead to another crash if the institutional investors continued to watch the situation from the sidelines, he added. Mr AB Mirza Azizul Islam, former finance adviser to the caretaker government, said institutional investors should go for investment to restore investors' confidence in the market. "If the institutional investors go for investment, the index will go up and the investors also gain confidence, as our investors take their investment decision considering index," commented Mr Islam, also former chairman of the SEC. "Traders who were expecting some positive steps from the previous day's meeting between the SEC and the stakeholders were disappointed, as nothing tangible came out of it Continued to page 20