DSE turnover dips as index suffers consecutive losses

Daily turnover on the Dhaka Stock Exchange (DSE) has dropped to around Tk 3 billion as the market continues to slide for a third consecutive day.

The benchmark index, DSEX, shed 54 points on Thursday, the final trading session of the week, bringing the three-day loss to 140 points.

Earlier, on May 6, the index plunged 150 points in a single day. Although it regained 119 points over the next two days, the market slipped again, taking the DSEX down to 4,781 points.

Turnover, too, declined over the week. On Wednesday, it dipped below Tk 3 billion, closing at Tk 2.94 billion.

Although Thursday saw a slight uptick to around Tk 2.97 billion, investor participation remained visibly low.

Some market watchers believe the delay in approving the annual financial statements of half of the 36 listed banks is partly behind the declining trade volumes.

The number of share transfers in the banking sector has also fallen in recent days.

Minhaj Mannan Emon, director of the DSE, views the persistent drop in the index as a sign of eroding investor trust.

“This is one of the key reasons,” he told bdnews24.com. “There’s no reason for the price drop otherwise. Where there’s no trust, how can anyone invest?”

Meanwhile, Bangladesh Bank chief Ahsan H Mansur said at a press conference on Wednesday that managing stock market investors is not the central bank's responsibility.

His remarks came in response to a question on the banks' pending financial disclosures, during the announcement of Bangladesh’s eligibility for the next International Monetary Fund (IMF) loan instalment.

The following day, trade in banking shares fell again, and the overall bearish trend continued.

Longtime investor Md Moniruzzaman, active in the capital market for over a decade, expressed disappointment with the current downtrend.

“I have stopped trading. Even my friends are staying away from the market. We had some hope in banking stocks, but that’s gone too,” he told bdnews24.com.

On Thursday, shares of banks, food and allied companies, and mutual funds saw higher turnover despite most stocks falling.

Out of 395 companies that traded on the DSE, prices rose for 42, fell for 317, and remained unchanged for 36.

At the end of the session, banking stocks accounted for Tk 513 million or 19.24 percent of total turnover. The day before, it was Tk 521.6 million or 19.26 percent.

On Tuesday, it had stood at Tk 959.5 million – the same as Monday.

Among other sectors, food and allied stocks saw a turnover of Tk 342.7 million while mutual funds accounted for Tk 240 million.

City Insurance, Mercantile Insurance and Bata Shoe topped the list of gainers based on closing prices, while Premier Leasing and Finance, Beach Hatchery and Sonargaon Textile Limited led the list of losers.