Dhaka stocks drop 1.6% amidst global tension

The stock market in Bangladesh plunged by over 1.6 percent today, mainly due to apprehensions of investors over news of the US joining the bombing of Iran with Israel.

The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE)--the country's premier bourse, plummeted 76 points to 4,677 from that on the preceding day.

The DS30, the index that tracks blue-chip companies, fell 24 points, or 1.34 percent, to 1,758.

The DSES, the stock index of the shariah-based companies, eroded by 2 percent to 1,016.

Due to the banking sector's high interest rates and poor performance of listed firms in recent quarters amid macroeconomic challenges, stocks were in a downward direction, which ultimately frustrated investors.

Now, the frustrated investors are apprehensive of global tensions as the US bombed Iran's three atomic sites, said MD Moniruzzaman, managing director and chief executive officer of Prime Bank Securities Ltd.

"Although the war is not impacting us yet, it has many tools that can impact the whole world. Especially if oil prices rise further, it will impact the Bangladesh economy further," he said.

Another stock market analyst said Bangladesh's stock market does not usually follow developments in the world arena, be it positive or negative.

However, this time, people fear that this war could deteriorate, which would impact the economy of Bangladesh, he said.

So, the market index dropped by a massive extent, he added.

Turnover at the DSE dropped 11 percent to Tk 271 crore. Among the stocks that underwent trade, 16 advanced, 365 declined, and 16 remained unchanged.

Shares of Taufika Foods and Lovello Ice-cream PLC were traded the most, amounting to Tk 19 crore, followed by Beach Hatchery Ltd (Tk 9 crore).

The food & allied sector dominated the turnover chart accounting for 18.44 percent of the total.

In its daily market update, UCB Stock Brokerage said all sectors closed negative today. Of them, paper & printing, non-bank financial institutions (NBFIs), and ceramics were the top three sectors that closed in negative territory.

All the sectors that account for large amounts in market capitalization, which refers to the total value of a company's outstanding shares of stock, posted negative performance, BRAC EPL Stock Brokerage said in its market update.

NBFI experienced the highest loss of 3.17 percent, followed by food & allied (2.30 percent), engineering (2.29 percent), telecommunication (1.62 percent), fuel & power (1.51 percent), pharmaceuticals (1.22 percent), and banking (1.13 percent), respectively.

In the Chittagong Stock Exchange, CSE All Share Price Index (CASPI), the premier index of the port city bourse, edged down by 171.46 points, or 1.29 percent to close at 13,099.41.