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Bangladesh - Bank & Finance - May 23, 2022

Investors frustrated in frequent fall

Stock market losing confidence

Mahfuz Emran: The country’s stock market has fallen into a terrible fall. On Sunday, the first working day of the current week, in continuation of the previous week, the transaction ended with a big drop. The country’s stock market is frustrated as the downward trend continues for eight consecutive working days.
In this situation, many investors have lost their investment and lost their way. Investors’ losses are getting heavier as the share and unit prices fall every day. Companies standing on solid foundations are not immune from collapse. Ordinary investors are not finding a way to reduce losses.
Investors complain that the stock market is falling in a planned manner. An anti-government clique is active behind this fall in prices. They are making various efforts to embarrass the government.
Stock market analysts also think that there is no rational reason behind the ongoing fall in prices. They say that due to the continuous fall in prices, the share prices of many companies with good fundamentals are being devalued. Investors should not be panicked and buy shares by choosing a good company.
The market review showed that most of the companies’ shares and unit prices rose at the beginning of the transaction yesterday. Within 10 minutes of the transaction, the main index of DSE increased by 30 points. Such an upward trend started at the beginning of the transaction but it did not continue till the end.
Excluding the first 10 minutes of trading, the stock market was in a downward trend the whole time. Even the rate of decline has increased as the time has elapsed during the transaction. As a result, the day’s trading ended with a big fall in the index.
At the end of the day, the DSE’s main index DSEX fell 115 points to 6,142 points. In the previous seven working days, the main price index of DSE decreased by 440 points. The main index of DSE lost 552 points in eight consecutive working days.
The DSE-30 index, which is made up of better companies selected between the other two indices, fell by 39 points to 2,026 on Sunday. The DSE Shariah Index stood at 1,361 points, down 21 points from the previous day.
Only 21 companies traded on the DSE, and their shares and units rose. In contrast, the price of 345 has decreased. And the price of 13 remains unchanged. The market turnover was Tk 72 crore 21 lakh. The previous day’s transaction was Tk 6 crore 7 lakh. As a result, the transaction has increased by Tk 13 crore 33 lakh.
“I have seen the collapse of 2010,” Ibrahim, an investor, told Daily Industry about the continuing fall in the stock market. I made a big loss at that time. After a few ups and downs, I did not see such a situation. Loss in what I buy. I have not been in such a situation since 2010.
Regarding the fall in prices, Kazi Abdur Razzak, general secretary of the Bangladesh Capital Market Investors Unity Council, told that the current fall in the stock market is planned. The anti-government clique is deliberately bringing down the prices to embarrass the government. There is another cycle active with them, which is trying to grab the shares of ordinary investors at low prices.
He said that in the past also anti-government clique has tried to create instability in the stock market. That cycle is now active in the market again. BSEC should identify this cycle and take necessary steps. The BSEC can, through surveillance, find out who is increasing the pressure to sell abnormal shares and who is inactive.
He further added that the issue of Russia-Ukraine war is an old one. For this reason, there is no reason to have a negative impact on our stock market. The stock markets of other countries of the world are turning. So, it is clear that a special cycle to embarrass the government is deliberately causing the country’s stock market to fall.
When contacted, stock market analyst Professor Abu Ahmed told Daily Industry that the stock market was falling due to fears over the Ukraine-Russia war, the rise in the value of the dollar and other issues. All types of stocks, good and bad, have fallen in the market. Shares of many good companies have fallen below reasonable prices. I think investors should choose stocks and buy shares. Then good profit can be obtained.
Some investors say they have suffered bigger losses than in 2010. However, when asked if the stock market is as fragile as it was in 2010, the stock market analyst said that before the collapse in 2010, the share prices of all companies, good and bad, rose abnormally. No such situation has been created in the current market. So, there is no reason for the situation in the stock market to be like in 2010.
The current drop in prices seems to be temporary. However, the share prices of some companies have risen abnormally. Ordinary investors should be wary of these institutions.
Bangladesh Merchant Bankers Association (BMBA) President Chayedur Rahman said that we do not see any reasonable reason for the fall in the stock market. The stock markets of other countries of the world have also turned around.
We have some panic among the investors here on social media or for various reasons. Hopefully it will be cut very soon and we will get a good market.
Shares of Southeast Bank were the most traded currency on the DSE in the fall. 80 crore 25 lakh shares of the company have been traded. IPDC Finance, which is in the second place, had a turnover of Tk 39.17 crore. Beximco is in the third place with a turnover of Tk 35.63 crore.
Besides, Delta Life Insurance, Bangladesh Shipping Corporation, JMI Hospital Require Manufacturing, Salvo Chemical, GSP Finance, ACI Formulation and Shahinpukur Ceramics are among the top 10 companies listed on the DSE.
On the same day, the overall price index of Chittagong Stock Exchange (CSE) CASPI decreased by 362 points. 17 crore 3 lakh has been transacted in the market. Of the 26 companies that took part in the transaction, 17 saw price increases. Shares of 242 stocks declined and 13 stocks remained unchanged.

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