Economic Reporter :
The key indices of the Dhaka Stock Exchange (DSE) and the Chittagong Stock Exchange (CSE) extended losses on Wednesday as persisting uncertainty over the global economy and the commodity market volatility keep hurting investors’ sentiment.
The market extended the losing streak on Wednesday, with turnover dipping below Tk 5.0 billion mark after one year, as investors are mostly reluctant to make fresh investments in stocks.
The Dhaka Stock Exchange turnover stood at Tk 490 crore, which is the lowest since December 1, 2020, when it was Tk 490 crore and about 15 per cent down over the previous session amid shortened trading hours.
According to market analysts, investors preferred to hold onto their cash fearing a price hike of necessities during Ramadan and for the worldwide ongoing economic turmoil. The benchmark DSEX index shed 31 points or 0.47 per cent to close at 6,662-its lowest since March 8, 2022, extending its losing streak for the third straight session.
Its junior partners the Shariah-based DSES index lost over 4 points or 0.31 per cent at 1,456 while the blue-chip DS30 index was down more than 5 points or 0.22 per cent at 2,459.
Usually, turnover in the stock exchange tends to slow during Ramadan when most individual investors remained inactive, dealers say.
“It’s a negative trend that looks likely to continue,” said a top broker requesting not to be named.
Uncertainties around the war in Ukraine and rising inflation on the economic front recently have been the major reason for nervousness among investors, resulting in the sell-off, he added.
“Risk-averse investors liquidated their positions to avert further losses,” said EBL Securities in a note.
Due to the limited trading window during Ramadan, trading activity has been slowed, and turnover has been at its lowest in the last year, it said.
Moreover, the liquidity crunch of the capital market might exacerbate further this month amid growing consumption in Ramadan and the upcoming spending spree centering Eid-ul-Fitr, it added.
On the sectoral front, textile (15.5 per cent) issues exerted the highest turnover followed by engineering (15.2 per cent) and pharmaceuticals (10.4 per cent) stocks. Most of the sectors displayed dismal performance, out of which paper (-1.6 per cent ), general insurance (-1.5 per cent ), and tannery (-1.5 per cent ) exerted the most correction while only the cement (1.2 per cent ) sector exerted positive return on the bourse on Wednesday. Losers took a strong lead over the gainers as out of the 385 issues traded, 44 advanced, 293 declined, and 48 remained unchanged.
