The country’s stock market has been witnessing gradual fall for last several weeks as a good number of investors have taken a wait-and-see strategy ahead of the next parliamentary elections, experts said.
Besides, many of the investors are selling out their shares as some big companies have failed to satisfy them with their quarterly earnings and dividends, they added.
Eminent economist and share market expert Prof Abu Ahmed told Bangladesh Post, “Most of the investors have remained out of the action ahead of the national election while some others have showed selling spree out of disappointment for not getting enough dividends and earnings from some companies, contributing to a fall in the capital market.”
Under the circumstances, the government should give some fiscal supports to the market to bring back investors’ trust, he added.
The lead economist said the government should encourage good companies, both local and multinational, to float shares through offering IPOs.
Managing Director of Dhaka Stock Exchange KAM Majedur Rahman said, “In every country, investors usually make cautious investment before general elections. That is why, foreign investment in the market has come down.”
“This is not happened only in our country. The similar situation is seen in almost all countries including India, China and Sri Lanka,” he added.
“On the other hand, the country’s market size is still small. As a result, it witnesses ups and downs,” Rahman said.
“When the market size becomes big these issues will not be the cause of our headaches”
The stocks that fell for last three consecutive weeks have not seemingly responded positively despite certain measures on the part of the government.
On Thursday, the prime index of the DSE went down by 15.92 percent or 996 points to 5,258 points since 1 January, 2018.
It decreased by 3.25 percent or 177 points during last three weeks.
Meanwhile, the blue chips index (DS30) slummed by 18.23 percent or 416 points to 1,865 points since 1 January, 2018 and losing 3.11 percent during last three weeks.
The market capitalisation of the DSE on Thursday dropped to Tk 3,831 billion against Tk 4,234 billion on first working day of the current year.
On the other hand, the port city bourse, the Chittagong Stock Exchange (CSE) also saw negative trend during last consecutive three weeks with its selective category index (CSCX) losing nearly 369 points or more than 3.5 percent to close at 9,795 points on Thursday.