Dhaka stocks dropped for the sixth consecutive session on Monday to hit a fresh three-year low after the previous session, as panic driven investors continued offloading shares to protect their funds and remained cautious to observe the market trend amid a bearish vibe and the ongoing economic uncertainty, market operators said.
DSEX, the key index of the Dhaka Stock Exchange, decreased by 37.62 points, or 0.69 per cent, to close at 5,393.65 points on the day after losing 86.13 points in the previous trading session.
The key index posted its lowest on Monday after April 19, 2021, when it was at 5,349.91 points.
The key index lost a total of 303.06 points in the past five sessions.
With increased selling activity of the investors, the total turnover on the DSE rose to Tk聽561.21 crore on Monday, while it was Tk聽409.18 crore in the previous trading session.
The total turnover on the previous trading session on Sunday was the lowest after April 15, 2024, when it was at Tk聽367.53 crore.
Market operators said that the market was continuously falling amid forced-selling, investors reacting to news of the National Board of Revenue鈥檚 move on imposing capital gain tax on investors and rising economic worries in the country.
The foreign exchange reserves of the country fell to $13.76 billion, with the gross reserves dropping to $18.26 billion on May 12, marking a 10-year low, according to Bangladesh Bank data.
The NBR is considering phasing out tax waivers from different sectors, including those on capital gains of individual investors in the capital market.
DSE Brokerage Association of Bangladesh president Saiful Islam said that the news of the NBR鈥檚 possible imposing of capital gain tax might have somewhat affected individual investors. He added that the news of the capital gain tax was not the sole reason for the current condition of the market as it was still just a possibility.
鈥楾he bigger problem is the margin sale due to the continuous market fall. We have been asking for a review of the current margin policy for a long time so that the market could turn around,鈥� he said.
Margin-selling or forced-selling refers to聽a number of situations where an individual鈥檚 assets are required to be sold.
Market operators said that the Bangladesh Bank鈥檚 decision on increasing repo rates, which might lead to interest rate hikes on the money market, also impacted the capital market negatively, as investors might shift funds to banks.
The devaluation of the taka against the US dollar might add to the depressed state of the market, they said.
In the past 13 weeks, the market moved forward in only three weeks.
Market operators also said that multiple other factors were working behind the bearish trend of stocks, such as lack of investor confidence amid economic woes in the country and global geopolitical tensions, liquidity crisis in banks and sudden change of policies.
Of the 389 issues traded on the day, 81 advanced, 278 declined and 30 remained unchanged.
The DSE Shariah index decreased by 10.88 points, or 0.91 per cent, to close at 1,180.75 points on Monday.
The DS30 index lost 9.55 points, or 0.49 per cent, to finish at 1,938.88 points.
On the sectoral front, pharmaceutical issues exerted the highest turnover, followed by food and textile sector.
EBL Securities in its daily commentary said that the market witnessed daylong volatility while sellers continued their dominance across the trading floor, which led the majority of scrips to extend their correction mode while many remained stuck at the revised lower circuit without having sufficient buyers.
Orion Pharma topped the turnover chart on the day with its shares worth Tk聽41.45 crore changing hands.
Taufika Foods and Lovello Ice-cream, Rupali Life Insurance Company, eGeneration, Orion Infusion, Asiatic Laboratories, Navana Pharmaceuticals, Beach Hatchery, Sonali Aansh Industries and Alif Industries were the other turnover leaders.
