Stocks nosedived on Monday as the prime index of Dhaka Stock Exchange (DSE) plunged below 6,800-mark.
Investors continued to dump their holdings to avoid further erosion in their investments.
DSEX, the prime index of the DSE, slid 56.23 points or 0.82 per cent to settle at 6,799, which is the lowest in nearly three months since August 19. DSEX eroded more than 107 points within the past two trading sessions.
The market started to fall since the key index reached its new peak at 7,367 points on October 10 this year, since then the benchmark index has plunged more than 568 points, or 7.71 per cent, the DSE data showed.
Market analysts said the overall downward pressure intensified as inflation worries further hit investors' confidence due to the latest diesel price and public transport fare hike.
They said a sharp hike in diesel price is threatening an even sharper hike in public transport fare that has added to the already existing inflation worries.
"When the cost of living goes up, investment returns also need to go higher for people to maintain the same buying power. But they don't always do that," according to an analyst at a leading brokerage firm.
The market remained under sale pressure as worried investors continued to cash in on stocks while institutional investors remained on the sidelines, said a merchant banker.
He noted that investors have lost their confidence in the market as the prime index remained in a downward trend for the past few weeks.
A tussle between the Bangladesh Bank and the Bangladesh Securities and Exchange Commission over some policy matters related to the stock market also eroded investor confidence, he said.
Investors were carefully watching the fluctuations of stock prices while the rift between BSEC and BB exacerbated the bearish trend on the trading floor and made investors nervous, according to EBL Securities.
Two other indices also ended lower with the DSE 30 Index, comprising blue chips, losing 15.28 points to finish at 2,583 and the DSE Shariah Index (DSES) plunged 6.89 points to close at 1,437.
Turnover, a crucial indicator of the market, dipped below Tk 11 billion-mark again and amounted to Tk 10.75 billion on the country's premier bourse, in a further decline by 6.11 per cent over the previous day's tally of Tk 11.45 billion.
Top negative index contributors were BATBC, Investment Corporation of Bangladesh, Beximco Pharma, United Power and Robi. These five stocks jointly contributed over 25 point fall of DSEX, according to amarstock.com.
All major sectors suffered losses with financial institutions lost most 2.50 per cent, general insurance with 2.30 per cent, food 2.10 per cent, textile 2.30 per cent, power 1.10 per cent and banking 0.30 per cent.
More than 78 per cent traded issues lost their price, as out of 376 issues traded, 295 declined, 55 advanced and 26 remained unchanged on the DSE trading floor.
Beximco was the most traded stock with shares worth Tk 922 million changing hands, followed by Genex Infosys (Tk 618 million), NRBC Bank (Tk 603 million), Orion Pharma (Tk 513 million) and IFIC Bank (481 million).
The newly-listed Sena Kalyan Insurance topped the gainer's list for the second straight day, rising 10 per cent while Alif Manufacturing Company was the day's worst loser, losing 8.37 per cent.
The Chittagong Stock Exchange (CSE) also ended sharply lower with the CSE All Share Price Index - CASPI -plunging 210 points to settle at 19,868 and the Selective Categories Index - CSCX--, shedding 125 points to close at 11,936.
Of the issues traded, 219 declined, 38 advanced and 26 remained unchanged on the CSE.
The port-city bourse traded 10.78 million shares and mutual fund units with a turnover value of Tk 347 million.
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