Many retail investors have long been passing a troublesome period, as they are unable to sell securities to meet their urgent needs due to the capital market's closure, prolonged by the ongoing COVID-19 pandemic.
Talking to the FE, top officials of some market operators and their traders said job cut may take place in many offices, if it takes a long time to overcome impacts of the pandemic.
"A significant number of retail investors are day-to-day traders, who offload shares on and off to serve their family purposes. Presently, they are unable to offload shares due to long closure of the capital market," said a trader, who maintains investors' accounts at a leading brokerage firm.
Preferring anonymity, the trader also said the process of disbursing salary for the firms' employees has been stuck due to extension of the market closure.
However, the president of DSE Brokers Association (DBA) Sharif Anwar Hossain said the process of disbursing salary for April has already started.
"I hope the salary disbursement of employees has already begun. The Eid festival allowance may not be disbursed by many offices due to ongoing crisis," Mr. Hossain told the FE.
Trading on both the stock exchanges was closed for 10 days from March 26, following the public holiday announced to contain the COVID-19 outbreak.
Later, the closure was extended many times up to May 16 in line with the extended public holiday, which triggered concern among general investors and the market operators.
Presently, the number of active BO (beneficiary owner's) accounts is above 2.57 million, although over half of the accounts exist only in the name, as there are no securities in those accounts.
There are 250 stock brokers in the Dhaka Stock Exchange (DSE), while 148 stock brokers are operating in the Chittagong Stock Exchange (CSE).
Besides, 62 merchant banks and 46 asset management companies are in operations in the capital market.
DBA president Mr. Hossain, however, ruled out the possibility of any job cut at the offices, having limited operations and run by limited employees.
"Some job cuts may occur in some big institutions, having large-scale market operations," he added.
Asked, the CEO of a leading brokerage firm said job cut may occur in the offices of many operators, if the market closure continues again for a long time.
"After a certain period, I will cut some jobs or will offer employees the proposal of continuing jobs with lower salary as long-term consequences of the COVID-19 pandemic," he added.
The president of Bangladesh Merchant Bankers Association (BMBA) Md. Sayadur Rahman said both loss and profit are parts of business.
"Personally, I can assure that no job cut will occur at my office."
Asked about the problems of day-to-day traders amid the ongoing closure, the BMBA president said their investment behavior does not add any value to the depth of market.
"Investors should avoid this investment behavior for the sake of the market's depth and their own interest."
In this regard, the DBA president said in the current situation the sellers might not have enough buyers, as floor prices of the listed securities were set before the trading closure.
"So, I think investors would refrain from selling securities even though the market is opened," he added.
On March 19, the securities regulator set floor prices of the listed securities to contain the abnormal price plunge, observed before applying the mechanism. As a result, prices of the listed securities have no scope to come down below the floor prices.
Earlier, stakeholders of the premier bourse were at loggerheads over the proposal of reopening market amid public holiday.
The securities regulator and a section of the DSE brokers said incomplete automation of the stock exchange and insignificant number of mobile app users do not support trading resumption.
The DSE, however, moved to resume trading, and submitted a proposal to the securities regulator on Monday, seeking its approval to resume trading from May 10 for two hours a day.
The bourse also sought some waivers from compliance of the securities rules to conduct trading by connecting the clients through internet, email, mobile apps or any other electronic means.
Eventually, both the bourses on Wednesday again extended the closure of trading until May 16, as the government also extended the public holiday.
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