Dhaka stocks had a bumpy ride on Wednesday with DGEN, the benchmark general index of Dhaka Stock Exchange, continuing to fall for the third straight day, following the government decision to offload more shares of the listed state-run enterprises and the latest monetary policy announced by the central bank.
The DGEN lost 14.28 points, or 0.21 per cent, to close the day at 6,627.75 points.
Turnover on the bourse, however, increased to Tk 1,727.63 crore on Wednesday from that of Tk 1,680.70 crore on the previous day as the sellers outnumbered the buyers.
Market operators said the investors went for sell-offs in the opening hour on the day as they anticipated the market would be volatile because of increased share supply following Tuesday's government announcement to offload more shares of Jamuna Oil and Meghna Petroleum.
'Although the two companies had seen their share prices to fall on Tuesday but they made surprising gain today,' said a DSE stockbroker.
He also said the monetary policy announced for the first half of the current fiscal year also made the investors shaky on Wednesday.
Bangladesh Bank on Wednesday announced the monetary policy for the July-December period of the current fiscal year. The BB said the policy was aimed at squeezing money supply to unproductive sectors and squeezing money supply to unproductive sectors and discouraging speculative usage of money, like investment in the capital market.
Trading on the DSE was volatile on Wednesday as the DGEN lost 49 points in first five minutes from the opening. The index, however, gained 53 points in the next 10 minutes. The index had lost 60 points by around 1pm but started moving upward in the closing hours, finally ending the day in red.
Mahmood Osman Imam, a professor of finance at Dhaka University, said, 'The market correction in the last two days was natural as it had seen a gaining streak for a long time.'
He termed offloading shares of state-owned enterprises was a good move in the current market condition.
'In an upmarket new shares will attract more investors and people always have faith in government shares,' he said.
Mahmood Osman, however, said the companies should be more transparent in publishing their financial statements.
Asked about the impacts of the new monetary policy on the capital market, he said, 'If the policy does not encourage investment in the capital market, it should give a clear picture to the investors at the beginning. Otherwise, any last minute regulations would have more adverse impacts.'
Of the 263 issues traded on Wednesday, 114 advanced, 135 declined, and 14 remained unchanged.
Source : New Age
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