Sunday, July 21, 2024

Stock plunge sparks fresh protests

Hundreds of general investors took to the streets and blocked the busy road at Motijheel in the capital on Sunday as the general index of the Dhaka Stock Exchange plunged by 406.29 points three weeks after another massive collapse on January 20.
Investors came out of brokerage houses to assemble on the road passing by the DSE building about midday as the DSE general index fell by 297 points in an hour of trading because of panic sales of shares by investors, who lost their confidence in the market again.
At the close of the trading, the DSE general index stood at 6,719.04 points shedding 5.70 per cent as share prices of 238 issues out of the 255 traded on the day declined heavily.
The investors halted traffic on the road between the Bangladesh Bank and the Ittefaq crossing and held rallies in small groups in the presence of policemen between 12 noon and 4:00pm. No untoward incidents were, however, reported.
General investors, angered by repeated market collapse, demanded immediate resignation of the finance minister, Abul Maal Abdul Muhith, and the Bangladesh Bank governor, Atiur Rahman, for their failure to stabilise the market.
Some investors announced to enforce a general strike for four hours beginning 11:00am on Tuesday while another group extended their support to the general strike the Bangladesh Nationalist Party has called for today. Yet another group opposed any call for general strike. But all the groups were unanimous in their demand for Muhith and Atiur’s resignation.
Investors blamed the government for the repeated market collapse and for the government’s failure to come up with appropriate measures to stabilise the stock market.
‘This government has completely failed to stabilise the share market. The collapse has ruined us as we have again lost 30 per cent of our investment,’ said an investor at a rally.
Analysts said that the collapse of the market was inevitable on Sunday after investors had become nervous because of the previous week’s downtrend following the declaration of monetary policy by the Bangladesh Bank and market regulators’ two new directives within two weeks of the market collapse on January 20.
The market also faced liquidity crisis as large investors, who made huge profits in December, remained almost inactive and were watchfully waiting about buying shares for lower prices.
General investors, in the third week of January, clashed with the law enforcers on the roads and the government suspended trading for a few days after the DSE general index had shed more than 1,500 points in three days, including a 600-point fall in five minutes of trading on January 20.
The finance ministry made 14 decisions on January 23 to boost investor’s confidence. The ministry formed a committee to investigate the market collapse and asked banks to reinvest their profits made from the capital market.
‘None of the decisions of the ministry were yet to be implemented. Why should the committee take two months to investigate the collapse as the finance minister said that all the data are available with the Central Depository of Bangladesh Limited?’ said another investor at a rally near the Madhumita Cinema.
Investors also criticised the Bangladesh Bank for announcing monetary policy discouraging banks to invest in ‘unproductive sector’ at this time when the capital market was facing liquidity crisis and the government had asked banks to reinvest their profits in the capital market.
‘The confidence of general investors has been dealt a blow again in a few days’ trading. Inactiveness of large or institutional investors also played a big role in the market collapse,’ said an analyst.
A high official of the Securities and Exchange Commission said that the market regulators had no measures about or nothing to do with the current market situation.
‘The market will take its natural course. We have nothing to do if it falls. We can not force any big investors, and anyone for that matter, to buy shares to keep the market afloat,’ he told New Age on Sunday evening.


Via: New Age

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