Stocks took a sharp downturn this week, reversing the gains made in the previous week, as jittery investors, unsettled by growing political unrest, rushed to dump their holdings across major sectors.
Analysts pointed to the escalating political concerns, particularly after the Election Commission announced the schedule for the 2026 national elections, which triggered a broad-based selling spree that deepened market negativity.
A leading broker noted that the announcement of the election schedule on December 11 had initially sparked some optimism, helping the market recover by 77 points.
However, investor sentiment quickly soured, with many fearing the political situation could escalate further, compounding the difficulties faced by an already struggling market.
The situation worsened after the tragic shooting of Sharif Osman Hadi, a prominent youth leader involved in the 2024 pro-democracy movement, who was critically injured in broad daylight on December 12. Hadi succumbed to his injuries in a Singapore hospital on Thursday night.
This incident added fuel to the fire of political unrest, increasing unease among investors and further contributing to the downward pressure on stocks.
"Stocks faced broad-based sell-offs as worsening sentiment dragged most sectors into the red, as uncertainties surrounding the upcoming election weigh heavily on the market," said the stockbroker.
Subsequently, all four trading sessions of the week ended lower. The market remained closed on December 16 on the occasion of Victory Day.
The prime index of the Dhaka Stock Exchange (DSE) finally settled the week 132 points or 2.67 per cent lower at 4,831, after recovering 77 points in the week before.
The market-cap of the DSE also shed Tk 105 billion during the week as sellers dominated throughout the week in an attempt to protect already strained portfolios.
The blue-chip DS30 index, a group of 30 prominent companies, also lost 43 points to close at 1,860 and the DSES index, which represents Shariah-based companies, shed 34 points to 1,001.
EBL Securities, in its weekly market analysis, said bearish sentiment persisted throughout the week, as the market failed to earn any breather amid the absence of any major catalyst for reviving the investors' waning confidence.
"Broad-based selling pressure prevailed across the board, as investor jitters surrounding the unfolding political situation induced further caution among market participants," said the stockbroker.
"The prolonged volatility prompted investors to reduce their exposure to the market's ailing momentum to limit further losses in their already hampered portfolios," it added.
Price erosion of blue-chip stocks, including Islami Bank, BRAC Bank, Beximco Pharma, Walton, Grameenphone, Al-Arafah Islami Bank and Square Pharma, largely contributed to the index fall. These seven stocks accounted for a 47-point drop in the DSEX.
The market liquidity remained low as the total weekly turnover stood at Tk 15.5 billion as against Tk 20.88 billion in the week before as this week saw four sessions instead of previous week's five.
Accordingly, the average daily turnover dropped below Tk 4 billion and amounted to 3.87 billion, as against the previous week's average turnover of Tk 4.18 billion.
Investors were mostly active in the textile sector, which accounted for 16.7 per cent of the week's total turnover, followed by pharma (12.8 per cent) and engineering sector (12.6 per cent).
Losers outnumbered the gainers, as out of 389 issues traded, 335 saw price declines while 32 others ended higher and 22 issues remained unchanged on the DSE floor.
All major sectors showed negative performance. The non-bank financial institutions saw the highest correction of 4.6 per cent, followed by engineering, power, banking, food, telecom and pharma sectors.
Low-cap stocks dominated the weekly turnover chart, with Fine Foods becoming the most-traded stocks, with shares worth Tk 611 million changing hands, closely followed by Dominage Steels, Orion Infusion, Lovello Ice-cream, and Monno Fabrics.
The Chittagong Stock Exchange also ended lower, with its All Shares Price Index (CASPI) shed 247 points to close at 13,624, while the Selective Categories Index (CSCX) fell 148 points to 8,403.
The port city bourse traded 7.42 million shares and mutual fund units with a turnover value of Tk 279 million.
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