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DSEX sinks to three-month low

Key index erodes 101 points in 2 days

FE REPORT | November 15, 2022 00:00:00

Stocks witnessed yet another setback on Monday, with the key index of the Dhaka Stock Exchange (DSE) tumbling to three-month low, as investors continued to dump their holdings to avoid further erosion of their portfolios.

DSEX, the benchmark index of DSE, slid 51.34 points or 0.81 per cent to settle at 6,253 - the lowest level since August 17 this year. DSEX eroded 101 points in the past two days.

Most of the traded issues remained unchanged due to the 'floor price' restriction. Of the 342 issues traded, 68 declined, 18 advanced and 256 issues remained unchanged on the DSE.

Market analysts said the stocks nosedived as looming economic uncertainties and the country's macroeconomic cues hit investors' sentiment.

The market has been struggling for the past few months since the Russia-Ukraine war began which was exacerbated by fears over a possible economic depression, said a leading broker.

The growing economic worries and dismal earnings declaration by listed companies coupled with rumours of liquidity crunch in banks mounted the crisis among the investors, he said.

The panic-stricken investors kept their sell-off shares though the Bangladesh Bank (BB) assured on Sunday that people's deposits are safe in banks.

Stocks logged extreme hurdles for the second day in a row as dismal corporate earnings prompted investors to dump their holdings, said EBL Securities.

"The market has been wading through choppy trading in the past few sessions induced by the adverse macroeconomic situation and dismal financial performance of the listed companies," said the stockbroker.

Investors opted to protect their funds from the ailing market in an effort to minimise their losses, said the stockbroker.

According to International Securities, jittery investors went on a heavy sell-off to exit from the market by dumping their shares for a while now as they fear deepening challenges in the coming months due to the macroeconomic worries.

The quarterly earnings declarations also failed to satisfy the investors' expectation while some investors were stuck with heavy losses in their portfolios and cannot get out of it due to the floor price mechanism, said the stockbroker.

More than 40 listed companies disclosed their quarterly earnings on Monday and most of them posted lower profits, even some entered into the losses.

The newly listed Navana Pharma posted a 20 per cent higher profit in the first quarter of the current fiscal year of 2022-23, but its share price dropped 9.97 per cent to close at Tk 95.70.

ACI suffered loss of Tk 3.94 per share (consolidated) for July-September 2022 as against profit of Tk 3.42 for the same quarter period last fiscal year.

However, its share remained stuck at floor - Tk 273.20 - since November 7.

Turnover, a crucial indicator of the market, also dropped to Tk 7.14 billion, from Tk 7.24 billion in the day before.

Genex Infosys kept its dominance in the turnover list with shares worth Tk 745 million changing hands, followed by Orion Pharma, Beximco and Sea Pearl Beach Resorts.

The Chittagong Stock Exchange (CSE) also ended lower with the CSE All Share Price Index (CASPI) losing 106 points to settle at 18,530 and its Selective Categories Index (CSCX) shedding 64 points to close at 11,103.

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