Dhaka stocks end marginally lower

Dhaka stocks ended Monday marginally lower amid the High Court (HC) rule against the securities regulator's directive on minimum two per cent share holding by sponsors/directors.

The market analysts said some investors were suspecting negative impact of the rule on the market, but the market experienced no major fall as the HC did not issue any stay order.

The market witnessed volatility and DGEN dropped more than 50 points within five minutes. After that, it recovered gradually and finally closed only 7.72 points lower.

The benchmark General Index, the gauge of Dhaka Stock Exchange--- (DGEN), ended at 5,099.04, losing 7.72 points or 0.15 per cent.

The broader All Shares Price Index (DSI) lost 8.98 points or 0.20 per cent to close at 4,277.31. The DSE-20 Index comprising blue-chip shares also lost 5.25 points or 0.13 per cent to close at 3,760.16.

Mr AB Mirza Azizul Islam, former finance adviser to the caretaker government, said that some investors were suspecting negative impact of the rule on the market, but later they understood the issue.

"The investors were worried following the rule, but they understood the matter later and refrained from panic sale and they behaved somewhat matured," commented Mr Islam, also former chairman of the SEC.

He advised the investors to analyse companies' fundamentals, past track record and growth before taking investment decision.

The investors should not be worried about external issue, he added.

A stock broker said the investors somewhat got relief, as the DSE authorities met with Attorney General Mahbubey Alam Monday morning.

After the meeting, Mr Alam told the journalists that they would defend the SEC directive as it was issued to protect the interest of the stock market.

He also told the journalists that the HC did not issue any stay order on the SEC directive.

After his statement, the market started to turn positive, though it started with a steep fall, he said.

"The market dropped initially amid the news of writ against sponsors/directors' share purchase, Bangladesh Bank's approval to new banks and cloudy investment scenario but its recovered later as activity remained up," commented IDLC Investments Limited.

"The investors were nervy at the beginning of the trade due to the writ petition filed by a director against the SEC directive to hold at least 2.0 per cent share to retain directorship. But the sentiment soon came back as individual securities started to rally robustly," stated LankaBangla Securities.

The turnover value increased slightly to Tk 6.89 billion against Tk 6.80 billion in the previous session.

However, most of the issues traded on the day lost in prices. Out of 256 issues traded, 162 declined, 83 advanced and 11 remained unchanged.