Net portfolio investment on the Dhaka Stock Exchange (DSE) declined by 78.58 per cent or above Tk 2.84 billion in July after a significant jump observed in previous month, the market insiders said.
The net overseas investment stood at Tk 776.5 million in July against the investment worth above Tk 3.62 billion observed in the previous month.
The overseas investment increased by 180 per cent in June than the previous month.
The market insider said foreign portfolio investment depends on various factors including the political uncertainty.
"Overseas investors show interest for special stocks up to a certain level of market price. The market prices of those kinds of shares have increased enough. It can be a reason behind the poor turnover observed in July," said Md. Moniruzzaman, the managing director of the IDLC Investments.
He said the overseas investors may have an apprehension of political uncertainty that can be spurred after the Eid-ul-Fitr.
Limited trading sessions were another reason behind the poor turnover in portfolio investment.
The DSE observed only 17 trading days in July whereas 22 trading days were observed by the premier bourse in previous month-June.
The market also remained flat in July compared with June with poor turnover that kept overseas investors almost silent on the trading floor, they said.
According to data found in the DSE, shares worth above Tk 1.66 billion were purchased in foreign portfolios whereas sales of shares stood at Tk 868.0 million in those ones in July.
And the turnover in foreign portfolios stood at Tk 2.53 billion in July as against the value of Tk 6.02 billion observed in the previous month.
The net foreign investment hit an all-time high of above Tk 5.72 billion in April, 2014 when overseas investors purchased shares worth Tk 8.76 billion and sold shares sales worth Tk 3.04 billion.
Earlier, the highest single-month net foreign investment on the premier bourse was above Tk 3.39 billion in June, 2013 when overseas investors had bought shares worth Tk 3.39 billion and sold shares worth Tk 583.0 million with the total turnover value of Tk 4.53 billion.
