The capital market rebounded strongly as investors brought in almost Tk 34,311 crore on the Dhaka Stock Exchange (DSE) during only a month despite maintaining strict-lockdown.
Besides, stocks expanded the gaining streak for the fourth straight week as investors' buying appetite continued on sector-wise securities based on the quarterly earnings and year-end dividend declarations.
DSEX, the prime index of the DSE, increased by 351.41 points to settle at 5606 points on Thursday in the four consecutive weeks.
Market analysts said the stocks witnessed upward trend due to positive regulatory initiatives coupled with lowering the circuit breaker for several companies prompted investors to put fresh funds on stocks.
Despite the virus-induced strict lockdown, most of the investors, especially institutional ones, took advantage of low-priced shares of some large-cap issues which helped the market end higher, they mentioned.
They said the stock market regulator's decision to keep the market open despite lockdown had positively impacted investors' enthusiasm.
Market capitalization of the DSE went up by 7.74 percent or Tk 34310.98 to Tk 477656.70 crore on Thursday from Tk443,345.80 on 4 April this year.
Before lockdown imposed by the government, this fund declined by 6.28 percent or Tk 29749.91 crore to Tk 443345.80 crore on April 4 from Tk 473095.70 on March 4.
Despite coronavirus crisis, 1.11 lakh new investors came into the capital market within four months as growing investors’ confidence amid market-supportive measures, which played a crucial role to bring fresh funds into the market, experts said.
Eminent economist and market expert Prof Abu Ahmed told Bangladesh Post, “People’s interest in the capital market has increased due to tightening investment in savings certificates and lower interest rates on bank deposits.”
Investment in the capital market is increasing, especially as there are less opportunities for alternative investment, he said adding that investor confidence has begun to return after the new commission took charge, and its various positive steps.
“As part of its move, new investors are entering the market every day and BO accounts are increasing. As a result, transactions and market capitalization in the capital market are increasing,” Abu mentioned.
He urged the government to bring some good companies into the market, which will help to build strong capital market.
Professor Shibli Rubaiyat-ul-Islam, chairman of the regulatory body of Bangladesh Securities and Exchange Commission (BSEC), said on Thursday, “Many foreign countries including America, Singapore and United Arab Emirates have expressed interests to invest in the capital market in Bangladesh, which will help to build stronger market.”
Highlighting the interest of foreign investors in investing in the capital market of Bangladesh, he said, "We are constantly approached by different countries for investment. The list includes Singapore and United Arab Emirates. Even from American investors are contacting DSE authorities for investment. So, money will not be a problem.”
“We are far behind compared to many other countries,” he said adding, “If we cannot build a strong market after 50 years of independence, then we can surely speed up the process.”