Free fall on DSE again, DGEN hits nearly 22-month low

FE Report Dhaka stocks witnessed yet another steep fall Sunday, the first day of the week, and DGEN came down to nearly 22-month low, as the investors went for panic sale amid streets protest. Market insiders said the investors went for panic sale from the start of the trading, as all the market bolstering measures failed to restore investors' confidence and stablise the market. The market opened with a free fall and lost more than 150 points within first hour of the trading. The downtrend continued throughout the session and finally ended 231 points lower. The benchmark DSE General Index (DGEN), the yardstick of the market, shed 231.65 points or 4.36 per cent to close at 5,077.12 which was 22 month-low since January 20, 2010. On January 20, 2010, the DGEN was 4,998.58. The DGEN lost 478 points in the last three consecutive trading sessions and now hovering around 5,000 points historic low. The broader DSE All Shares Price Index (DSI) shed 196.07 points or 4.41 per cent to close at 4,243.12. The DSE-20 blue-chip index also fell 110.27 points or 2.84 per cent to close at 3,763.81. Market insiders said massive sell off, following negative comments by the finance minister and recent concerns of World Bank and IMF on the stock market, continued as traders unloaded their shares fearing further fall. Mr Fakhor Uddin Ali Ahmed, president of the Chittagong Stock Exchange, said the market cannot stand on strong foot, as the institutional investors remain out of the market. "The market will not return to its right track unless the big and institutional investors become active in the market," said Mr Ahmed. "The investors' confidence is eroding day by day and came to an exit points, as repeated assurances by market regulators, central bank and different stakeholders failed to stablise the market," commented a stock broker. "The market situation has already become very alarming as desperate moves failed to stablise the market and it is further hit by latest concerns of World Bank (WB) and International Monetary Fund (IMF) and the finance minister's harsh comment," he said. Disclosure of third quarter earnings of AB Bank, NCC Bank, MTBL and some NBFIs apparently failed to meet investors' expectation, which accelerated massive sale, he added. "Hemorrhage started from opening bell while companies started posting poor quarterly earnings plunging both retail and institutional investors into utter frustration," stated LankaBangla Securities in its daily market commentary. As of on the day earnings of bank and NBFIs sectors declined 5.44 per cent and 49.27 per cent respectively than that of same period of previous year, it said. "Both sectors have been highly affected by the worst capital market activities in this period," it added. The volume of shares sold testified possibility of forced sale and DGEN ended below 5,080 points, which was last witnessed in 24th January 2010, a market insider commented. Turnover value declined to Tk 3.30 billion against Tk 3.44 billion in the previous session indicating that institutions investors are yet to be fully active in the market. The losers thrashed the gainers as out of 251 issues traded, only seven advanced, 237 declined and seven remained unchanged. A total of 102,211 million shares changed hands on the day against 97,782 million in the previous session. The trade deals, however, also declined to 48.45 against Thursday's 51.71. Total market capitalisation of th e DSE, also declined to Tk 2,537.31 billion against Tk 2,663.83 billion in the previous session. All sectors ended red, as aggressive selling pressure witnessed all across the board with NBFIs was the worst losers among the major sectors following poor quarterly earnings discloser of most of the NBFIs. NBFIs sector lost 6.14 per cent, whereas telecommunications, banks, fuel and power and pharmaceuticals declined by 4.67 per cent, 4.07 per cent, 3.54 per cent and 2.60 per cent respectively. Beximco Pharma topped the turnover list with shares worth Tk 181.79 million changed hands. The other turnover leaders were Beximco Limited, Titas Gas, GP, Mercantile Bank, SIBL, UCBL, National Bank, Malek Spinning and ONE Bank. There were only seven gainers on the day---Meghna Condensed Milk, LG Global Mutual Fund One, Sixth ICB, Mercantile Bank, Eighth ICB, ICB Third NRB and ACI 20 per cent Zero Coupon Bond. The day's worst losers included Samorita Hospital, Prime Textile, Metro Spinning, Fu-Wang Ceramic, Malek Spinning, Fine Foods, Samata Leather, Anwer Galvanising, Agni System Limited and Miracle Industries.