Stock turnover dips further
Thursday, 12 May 2011
FE Report
High volatility marked the Wednesday trading on the Dhaka Stock Exchange (DSE) amid nearly four-month low turnover as the investors' confidence continued to remain in lower level. Lack of confidence among the general investors persisted and they sold their stocks in panic, as a result the market could not get strength, said a merchant banker. Continuation of liquidity crunch in the money market took heavy tolls in stock market as daily turnover came down to only Tk 3.07 billion in value terms, down by 19 per cent, against Tk 3.82 billion in the previous session. This was the nearly four-month low daily turnover since January 25. On January 25 the turnover was Tk 2.06 billion. Record date for Beximco groups share also contributed heavily for lower turnover, market insiders said. Meanwhile, the market opened with a negative note in the morning and lost more than 50 points within five minutes. After that DGEN fluctuated between highest 5,519.87 to lowest 5,445.69 points several times throughout the session and finally closed 36 points lower. The benchmark DSE General Index (DGEN), main gauge of the market shed 36.99 points or 0.67 per cent to close at 5,482.87. The broader All Shares Price Index (DSI) came down to 4563.85, shedding 32.63 points or 0.70 per cent. The DSE-20 index comprising blue-chip shares also lost 18.40 points or 0.50 per cent to 3,625.92. Market sentiment was affected in recent days over the speculation of further fall of market and government to follow slow pace regarding re-cast of SEC including recruitment of its chairman, stock brokers said. Liquidity crunch in the money market, low confidence of general investors and absence of big and institutional investors caused the market dragging down, said capital market analyst Akter H Sannamat. "To increase cash support in the market, the central bank should immediately reduce the SLR (Statutory Liquidity Requirements) and CRR (Cash Reserve Ratio) ratio of the commercial banks to bring bank confidence in the market," said Mr. Sannamat. He said the Securities and Exchange Commission's surveillance team should strictly monitor the market trading.
High volatility marked the Wednesday trading on the Dhaka Stock Exchange (DSE) amid nearly four-month low turnover as the investors' confidence continued to remain in lower level. Lack of confidence among the general investors persisted and they sold their stocks in panic, as a result the market could not get strength, said a merchant banker. Continuation of liquidity crunch in the money market took heavy tolls in stock market as daily turnover came down to only Tk 3.07 billion in value terms, down by 19 per cent, against Tk 3.82 billion in the previous session. This was the nearly four-month low daily turnover since January 25. On January 25 the turnover was Tk 2.06 billion. Record date for Beximco groups share also contributed heavily for lower turnover, market insiders said. Meanwhile, the market opened with a negative note in the morning and lost more than 50 points within five minutes. After that DGEN fluctuated between highest 5,519.87 to lowest 5,445.69 points several times throughout the session and finally closed 36 points lower. The benchmark DSE General Index (DGEN), main gauge of the market shed 36.99 points or 0.67 per cent to close at 5,482.87. The broader All Shares Price Index (DSI) came down to 4563.85, shedding 32.63 points or 0.70 per cent. The DSE-20 index comprising blue-chip shares also lost 18.40 points or 0.50 per cent to 3,625.92. Market sentiment was affected in recent days over the speculation of further fall of market and government to follow slow pace regarding re-cast of SEC including recruitment of its chairman, stock brokers said. Liquidity crunch in the money market, low confidence of general investors and absence of big and institutional investors caused the market dragging down, said capital market analyst Akter H Sannamat. "To increase cash support in the market, the central bank should immediately reduce the SLR (Statutory Liquidity Requirements) and CRR (Cash Reserve Ratio) ratio of the commercial banks to bring bank confidence in the market," said Mr. Sannamat. He said the Securities and Exchange Commission's surveillance team should strictly monitor the market trading.