Dhaka stocks see biggest fall in 3 years

FT ONLINE

Dhaka stocks slumped 2.21 percent, the steepest fall in nearly three years, as investors dumped shares causing the market to tumble for a fourth consecutive session.

Sunday’s fall was the sharpest single-day percentage drop since Apr 26, 2015, when the benchmark index plunged 2.26 percent.

Market participators, who describe it as ‘abnormal’, however, rejected fears of political instability being the reason behind the selling spree that caused share prices of more than 90 percent of the companies to fall.

The Dhaka Stock Exchange has held an emergency meeting over the market rout.

Leaders from the Bangladesh Merchant Bankers Association and the DSE Brokers Association joined top officials of the bourse and top brokerage firms at Sunday’s meeting.

Tensions are running high on the political front as the verdict in a graft case against BNP chief Khaleda Zia is expected on Thursday.

The stock market has logged losses over the reduction in banks’ advance to deposit ratio and the monetary policy announcement.

Some market observers believe the uncertainty regarding the verdict in Khaleda’s graft trial also has contributed to the losses.

A Dhaka court is set to give its verdict in the Zia Orphanage Trust graft case on Thursday.

Khaleda faces up to life in prison if found guilty of the charges brought by the Anti-Corruption Commission.

The BNP claims it to be a government plot to keep her out of contention for the general election as a conviction will see the former prime minister rendered ineligible for the polls.

The key DSEX index lost 133 points at closing on Sunday to end on 5,888 points.

It fell nearly 327 points in the six previous sessions and 380 points in the past 30 days.

Losers beat gainers 320 to 23 and 11 scrips remained unchanged with shares of Tk 3.64 billion changing hands, up by Tk 350 million from Thursday.

The Chittagong Stock Exchange’s broad index fell 404 points to 18,219.

Prices fell for 194 of the shares and mutual funds on the bourse, while 14 increased and remained unchanged.