Stocks face steepest fall since introduction of floor price

The benchmark index of the Dhaka bourse on Monday had the deepest fall since the re-introduction of floor price two and a half months ago to prevent a collapse in the capital market.

Companies that have been booming at an unusual rate for the past few weeks, were also seen on the top list of decline on the day. Among them was Orion Pharma, the largest company of the much-discussed Orion Group.

DSEX, the key index of the Dhaka Stock Exchange (DSE), fell by 119 points or 1.82 percent after a three-day break from the weekly closure and Eid-e-Miladunnabi holiday.

The DSEX fell below 6,500 points during this fall. After giving the floor price on July 28, the index has not fallen so much in one day.

After imposing the floor price, the index fell by 78 points on August 10 and 58 points on September 5. But overall, the index had risen by more than 600 points after floor price was introduced.

The DSEX is now at 6,449 points, which is the lowest position in the last 5 weeks when it was at 6,431 points.

Among other indices, the shariah-based DSES fell by 27.61 points or 1.91 percent and the blue-chip DS30 was down by 47.43 points or 2 percent.

Ahmed Rashid Lali, former president of DSE Brokers Association, believes the big fall on Monday was due to panic.

He said there were false rumours in the market that the floor price was being lifted which panicked investors.

Besides, many mistook the prime minister’s recent speech where she warned about the slowing down of the economy after the coronavirus and the Russia-Ukraine war.

These issues created selling pressure in the capital market on Monday, he said.

However, on the day, a commissioner of the Bangladesh Securities and Exchange Commission (BSEC) put an end to such rumours by stating that the regulator has no plans to lift the floor price at the moment.

Although, on the day of heavy decline in the index, the turnover volume of money increased slightly from the previous working day.

The DSE had a turnover of Tk 1,417 crore, which is about Tk 248 crore more than the previous session.

On the day, shares of the 368 companies were traded, of which only 19 firms gained, 167 issues lost and 182 companies remained unchanged.

The shares of pharmaceuticals and chemicals sector was the most traded stocks of the day. The total turnover in this sector was Tk 302.03 crore, which is 22.91 percent of the total turnover.

The miscellaneous sector was at the second position with Tk 187.8 crore turnover, followed by engineering sector at Tk 173.2 crore.

Shares of Orion Pharma were the most-traded by value on the DSE as its shares worth Tk 150.32 crore were traded on the day.

Beximco Limited, which was the second most-traded stock, had a turnover of Tk 115.45 crore followed by Sonali Paper, IPDC Finance, Eastern Housing, JHRML, BBS, Shinepukur Ceramics, orion Infusion and Intraco.

Meanwhile, the overall index CASPI of the Chittagong Stock Exchange (CSE) decreased by 283 point to 19,049 and securities worth Tk 19.57 crore were traded on the day.