DSEX sinks below 5,000 points after four months amid political jitters, bank turmoil

The Dhaka Stock Exchange (DSE) extended its losing streak for the fourth consecutive session today (5 November), with its key index DSEX slipping below the psychologically critical 5,000-point mark for the first time in four months, as persistent investor pessimism deepened amid political uncertainty and turmoil in the banking sector.

According to DSE data, the benchmark DSEX dropped 32 points, or 0.64%, to close at 4,986, marking its lowest level since 8 July, when it had touched 4,981 points. The blue-chip DS30 index also declined by 5 points to settle at 1,940. Market participation, however, showed a slight improvement as turnover rose by 7% to Tk485 crore from the previous session.

Of the 400 issues traded, 70 advanced, 267 declined, and 63 remained unchanged, reflecting a broad-based sell-off that swept across most sectors.

Market analysts attributed the decline to the prevailing political tension ahead of the forthcoming national election and renewed worries over the health of the banking sector following Bangladesh Bank's announcement of the non-viability of five merged Islamic banks — Social Islami Bank, First Security Islami Bank, Exim Bank, Global Islami Bank, and Union Bank.

Bangladesh Bank Governor Ahsan H Mansur told reporters yesterday that the central bank had begun physical intervention in all five institutions, officially dissolving their boards and declaring them non-viable.

He added that shareholders of these banks would not receive any compensation since the net asset value (NAV) per Tk10 share had turned negative, as high as Tk450 in deficit for some banks. Consequently, the share value of these banks is effectively considered zero, dealing a severe blow to both sponsor and retail investors.

The news triggered widespread panic across the bourse, prompting investors to offload holdings and driving down share prices in the banking and financial sectors.

In its daily market review, EBL Securities noted that the market opened with mixed sentiment as investors engaged in bargain hunting early in the session, but selling pressure took over in the final hour.

"The benchmark index of the capital bourse deepened its bearish headwind today, breaking the psychological threshold of 5,000 points to hit a four-month low, as negative sentiment continued to prevail amid lingering political uncertainties," it said.

Among individual stocks, Orion Infusion, Summit Alliance Port, Anwar Galvanising, Asiatic Laboratories, and CVO Petrochemical were the day's most active scrips, accounting for a significant portion of total turnover.

Anwar Galvanizing continued its recent rally, emerging as the top gainer of the day with a 9.89% rise, followed by Premier Leasing, VFS Thread, Apex Foods, and First Finance. 
On the other hand, Oimex Electrode was the day's worst performer, sliding 10.38%, while Information Service Network, Orion Infusion, Intech, and Shurwid Industries also suffered steep declines.

The Chattogram Stock Exchange (CSE) mirrored the DSE's downtrend as its CASPI index dropped 105 points to close at 14,028, while CSCX fell 68 points to 8,652, with total turnover amounting to Tk24 crore.