Net foreign investment in Dhaka stocks fell 54 per cent in October from September as overseas investors adopted 'wait-and-see' policy after previous month's big investment.
Overseas investors bought shares worth Tk 3.02 billion and sold shares worth Tk 1.07 billion, taking their net investment to Tk 1.95 billion in October, according to statistics from Dhaka Stock Exchange (DSE).
In September, net foreign investment was Tk 4.26 billion, as foreign investors bought stocks worth Tk 5.89 billon and sold stocks worth Tk 1.63 billion, the DSE data showed.
"It's natural that foreign investors will not be in the same buying mood after making a big investment in the previous month (September)," said a stock broker who deals with foreign investment.
"The foreign investors adopted a 'wait-and-see' policy in October as their exposure to the stock market was high in September."
However, the statistical fall in net investment is not a matter of concern and one or two months' statistics is not enough to draw a conclusion on the foreign investment trend, he said.
It is a fact that the overseas investors are still interested in Bangladesh stocks; he said adding that overseas investors are continuously showing their interest about our market, making queries and seeking information about the market.
AB Mirza Azizul Islam, former caretaker government adviser, said the foreign investors always want to see a peaceful and stable political environment for their investment.
The foreign investors thought that the country's political situation may deteriorate again. They went to sideline as an anticipatory move, as political instability would affect profit of the listed companies, said Mr Mirza Aziz, also former chairman of Bangladesh Securities and Exchange Commission.
He stressed political stability, improvement in power and infrastructure, macro-economic equilibrium and foreign investor-friendly policies to attract more portfolio investment in the market.
Also known as portfolio investment, foreign investment accounts for around 2 per cent of DSE's total market capitalisation, which was Tk 3,343.83 billion as of Monday.
The foreign investors preferred power and energy sector. But non-bank financial institutions, pharmaceuticals, multinational companies, telecom and IT also caught their attention, brokers said.
In 2013, foreign investors bought shares worth Tk 26.52 billion and sold stocks worth Tk 7.09 billion, taking their net investment for the year to Tk 19.43 billion.
© 2024 - All Rights with The Financial Express
