Bangladeshi stocks headed down at the first trading session of new fiscal year as funds started to be pulled out after a tax rebate by opportunistic investors.
A lot of wealthy individuals tend to hold stocks on June 30 every year only for an income tax rebate. They usually pull funds back as early as possible after their purpose is served, which the market is observing now.
The DSEX, the benchmark index of Dhaka Stock Exchange, lost 0.67 percent to close at 5384.94 points on Tuesday as the market opens after the previous fiscal year ends.
Blue-chip index DS30 witnessed a fall of 0.86 percent, while Shariah compliant securities’ index DSES lost 0.77 percent over the session.
At Chittagong Stock Exchange (CSE), the port-city bourse, each of the indices lost more than their counterparts at the DSE. The CSE30, the blue-chip index there, was down by 1.51 percent while the broad index CSCX lost 0.74 percent to close at 10010.21 points.
Equity analysts concluded the market behaviour with a cautious note mentioning recent policy decisions.
Asrarul Haque, senior research analyst at EBL Securities Ltd, said investors worry about tax on retained earnings of listed companies eased after the revised finance bill approved in the parliament.
“But new worries appeared as the government implemented a 38 percent tariff hike for gas in industries, which will affect manufacturing companies’ profitability,” he added.
“Financial stocks today [Tuesday] showed negative momentum because of overall tight liquidity condition in both money and capital market,” he said.
Some top stock brokers said a sell-off from opportunistic investors need to be absorbed before the market stabilises.