Stocks plummeted on Sunday as jittery investors continued to dump their holdings amid fear over the impact of strict lockdown and withdrawal of floor price restriction for several companies.
DSEX, the prime index of the Dhaka Stock Exchange (DSE), fell by 90.07 points or 1.71 per cent to settle at 5,164. DSEX shed 173 points in the past two trading sessions.
The market opened sharply lower which continued till end of the session as panic gripped investors following the news of strict lockdown from April 14 amid worsening coronavirus situation.
The investors also reacted negatively to withdrawal of 'floor-price' restriction for 66 companies although the market regulator lowered the circuit breaker limit to 2.0 per cent from the existing 10 per cent on these companies.
Market analysts said withdrawal of floor price restriction for several companies coupled with deepening worries over the soaring coronavirus cases and deaths in the country continued to taking a heavy toll on the struggling market.
Panic gripped investors as they fear the strict lockdown is expected to continue for long time due to rising number of deaths from Covid-19, commented EBL Securities.
The stockbroker noted that the regulator's decision to put a 2.0 per cent lower circuit breaker on the 66 companies without floor price restriction failed to rescue the index.
The Bangladesh Securities and Exchange Commission (BSEC) last week withdrew the floor price for 66 listed companies set a year ago when the market was in free fall caused by the first wave of the Covid-19 pandemic.
However, the stock market regulator on Saturday lowered the circuit breaker limit to 2.0 per cent from the existing 10 per cent for the 66 companies.
The sudden decision of lifting floor-price of selective issues aggravated investors' pessimism over the market as they feared losing their investment on the stocks, said a leading broker.
He noted that the investors' sentiment remained weak due to ongoing lockdown amid rising coronavirus cases while the lifting floor price restriction for 66 companies trigger the selling pressure.
Two other indices also ended lower with the DSE30 Index, comprising blue chips, lost 37.48 points to finish at 1,952 and the DSE Shariah Index (DSES) plunged 20.04 points to close at 1,177.
Turnover, a crucial indicator of the market, also fell to Tk 4.56 billion amid reduced two hours trading, which was 4.0 per cent lower than the previous day's turnover of Tk 4.75 billion.
According to International Leasing Securities, the worried investors continued their heavy sell offs on all the sectors as experts cautioned about the second wave of Covid-19 which may hit hard the country's economy.
Major sectors saw price erosion with telecom witnessed the highest correction of 3.10 per cent, followed by engineering with 3.0 per cent, financial institutions 2.7 per cent, power 2.0 per cent, pharma 1.60 per cent and banking 0.80 per cent.
Losers took a strong lead over the gainers, as out of 340 issues traded, 264 declined, 24 advanced and 52 issues remained unchanged on the DSE trading floor.
Beximco - the flagship company of Beximco Group- was the most- traded stock with shares worth about Tk 454 million changing hands, followed by Robi, Bangladesh Finance, Purabi General Insurance and Asia Pacific Insurance.
A total number of 91,352 trades were executed in the day's trading session with a trading volume of 118.54 million shares and mutual fund units.
The market-cap of DSE also dropped to Tk 4,510 billion on Sunday, down from Tk 4,592 billion in the previous session.
The Chittagong Stock Exchange (CSE) also fell sharply with the CSE All Share Price Index - CASPI -losing 247 points to settle at 14,983 and the Selective Categories Index - CSCX shedding 150 points to close at 9,039.
Of the issues traded, 139 declined, 26 advanced and 27 remained unchanged on the CSE.
The port city's bourse traded 5.26 million shares and mutual fund units with turnover value of more than Tk 144 million.
© 2023 - All Rights with The Financial Express