Investors demo, blame SEC for creating panic
Volatility returned to the trading floor of the Dhaka bourse on Thursday, after Wednesday’s heavy gains, pulling down the general index sharply that prompted the angry investors to take to the streets for the second day in the week.
The DGEN, the benchmark general index of the Dhaka Stock Exchange, lost 129.43 points, or 2.02 per cent, to close the day at 6,259.90 points, after shooting up 196 points on Wednesday following a seven-day bear run.
The turnover of the bourse on the day, however, inched up by Tk 7 crore from the previous day’s Tk 618.68 crore as general investors rushed to sell-off shares, driven by a panic created by a sustained rumour that the market regulators were going to file cases against some big investors suspected to be involved in market manipulation that brought about the January’s stocks debacle.
Investors, who staged a rowdy demonstration on Tuesday in protest against the continued fall in share prices for seven straight days, on Wednesday came out of different brokerages on the street in front of the DSE building again at around 1:15pm, by the time when the DGEN had already lost around 130 points.
They blockaded the road, stopped vehicular movement between Shapla Square and Ittefaq Crossing, and brought out a procession that paraded the road section a few times.
They chanted slogans against finance minister Abul Maal Abdul Muhith, Bangladesh Bank governor Atiur Rahman, the Securities and Exchange Commission, and DSE president Shakil Rizvi for their failure to stabilise the market and infusing the investors with panic.
At one point, a section of the demonstrators turned rowdy and chased journalists covering the event, besides harassing the camera crew of Independent and Massranga television channels.
The investors ended the demonstration at around 2:10pm, after holding a short meeting in front of the DSE building. From the meeting, they warned the government that they launch a strike from Sunday for an indefinite period, if the market was not stabilised.
Market operators said many investors, who suffered the impacts of the January’s market crash and passed the following depression till June, were becoming more and more panicky by the day, fearing another round of debacle.
They blamed the SEC for foot-dragging in taking legal actions against the market manipulators.
‘The SEC on Monday announced that it was set to file cases against a number of market manipulators responsible for the January’s stock market crash, which spread fast through the grapevine. They should have filed the cases first and then announced that they had taken such an action,’ observed a stockbroker.
Many investors on Thursday also alleged that the announcement made by the equities market watchdog gave rise to the bearish trend of the past few days.
‘If they wanted to bring the manipulators to book, they could have done it without the unnecessary trumpeting,’ remarked an investor, adding that, ‘But, since making the announcement, they have been delaying the process, which helped rumours to spread and panic to be intensified among the investors.’
Investors also termed the recent bearish trend, which deepened after the SEC had decided to take legal action against market manipulators, unusual and plotted by a syndicate. ‘May be a syndicate is intentionally doing such market manipulation to put the regulators under pressure,’ said an investor.
Akter H Sannamat, a capital market analyst, said, ‘If the SEC finds any one guilty after investigation, it can take action against him or her by itself, because it would lake a long time to settle such issues under the judicial system as we have seen in the past.’
He said the commission should not have made such a public announcement of such issues and, if it did, it should go for immediate action to prevent any rumour to form.
Akter also said, ‘The SEC should gear up its surveillance and find out the quarters that had generated the heavy selling pressure in the last few days.’
‘It is very much possible for them to indentify the culprits,’ he added.
Of the 258 issues traded on the bourse on Thursday, only 12 advanced, while 241 declined and five remained unchanged.
-With New Age input