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War of discussion again about the lowest price

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Bangladesh Securities and Exchange Commission (BSEC) re-introduced the lowest price in the stock market in July this year to prevent continuous price decline. After the implementation of the lowest price, the market calmed down, but now most of the share prices remain unchanged. Market analysts have criticized the lowest price, but a section of investors are relieved. And those who are stuck on the lowest shares are criticized.

Analyzing the data provided by DSE, it can be seen that there is a week of relief in the stock market after the introduction of the lowest price. On the first day after lunch, the main stock market of the country, Dhaka Stock Exchange, saw a big rise in the price index. On that day DSE’s flagship index ‘DSEX’ rose 153 points. Two other indices of the major stock market also rose on that working day. At the same time, out of 382 companies that participated in the transaction on that day, the share prices of 362 companies increased.

Also, after the implementation of the lowest price, the market capitalization of the stock market increased by Tk 21 thousand crores in the first week. The lowest price was initially considered a boon for the stock market as the index jumped and market capitalization increased. However, as the days go by, the discussion and criticism about the matter are increasing. As People say the lowest price is preventing the share price from falling forcefully which result, in the market stakeholders also opposing the lowest price.

Due to the lowest price, most of the shares currently held by investors remain unchanged. A total of 373 companies participated in the trading on the Dhaka Stock Exchange (DSE) on the first working day of the week. Among them, the share prices of 177 companies were unchanged today. The prices of 81 companies have decreased. On the contrary, the price of 115 shares increased.

The market picture was the same last week as well. A total of 160 companies share prices were unchanged on DSE last September 25. The next day, September 26 shares of 173 companies were unchanged. On September 27, the share prices of 174 companies neither increased nor decreased. Share prices of 186 companies were unchanged in the next two working days. According to market watchers, the lowest prices are the main reason why the share prices of most companies remain unchanged.

Many consider such behavior unusual in the market. Most of the companies whose share prices were unchanged today did not fall due to the lowest price. Normally the number of unconverted shares used to be below one hundred. However, due to the lowest price, the share price of most of the companies has remained unchanged recently.

Share market analyst and former teacher of Dhaka University Professor Abu Ahmed thinks that the share market is suffering due to the lowest price. He said that even if an investor urgently needs money, he is unable to sell shares due to the lowest price. Some may want to sell their shares and sell some other shares. But he is unable to sell his shares due to the lowest price. However, a section of our investors is in favor of keeping the lowest price.

Saidur Rahman of Bangladesh Merchant Bankers Association BMBA declined to comment on the lowest price. But he thinks the lowest price is not a good solution for the stock market.

According to Bangladesh Investors Council President Mizar-ur-Rashid Chowdhury, BSEC will not raise the lowest price until the main index (DSEX’) reaches 10,000 points. He told that due to the provision of the lowest price, investors have regained their peace of mind. The market is now stable. If the lowest price is lifted now, investors will again suffer losses.

Mizan-ur-Rashid Chowdhury said we do not see any negative side to the lowest price. Because I can at least have the comfort of buying shares my share price will at least remain stable even if it doesn’t go up. If the lowest price is lifted, the market will collapse within a week, this representative of the investor council also believes.

The BSEC Executive Director and Spokesperson are looking at some positive aspects of the lowest price. Rezaul Karim. He told that the lowest price has been given to instill confidence in investors. The volume of transactions in the market also increased after the lowest price was issued. Where earlier the average transaction was below a thousand crore takas, it has now crossed a thousand crore takas.

In response to the question of whether the BSEC is thinking of something like this, the commission official said that when the lowest price was given earlier, the shares of many companies were not being sold. But this time the shares are being sold even though the price is unchanged. Therefore, the volume of transactions in the market has also increased. Everyday transactions are more than a thousand crore takas.

When the lowest price was first introduced in the stock market, most companies remained unchanged. As a result, BSEC withdrew the lowest price of 66 companies on April 7, 2021. Two months later, the lowest of another 30 companies stuck at the lowest price was withdrawn. The commission withdrew the lowest from the shares of all companies last year 20. The Securities and Exchange Commission (BSEC) again introduced the lowest price in the stock market on June 30 this year in the face of continuous price decline.

 

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Bearish Trend on DSE

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Dhaka Stock Market DSE, Bourse on the last working day of the week, 18th July, ended with a drop in Indices and Turnover from the previous working session. This information is known from DSE sources.

391 crore 52 lakh taka shares were traded on this day. 192 crore 89 lakh less tradings were done in DSE today compared to the previous workday, July 16th, Shares worth Tk 662 crores 24 lakh shares were traded last time, Tuesday.

The benchmark DSEX decreased 36.64 points or 5,446 The Shariah-based index DSES dropped 10.43 points or 1,191 and the blue-chip index DS30 lost by 8.10 points or 1,953.

Of the issues traded, 38 advanced, 311 declined and 46 remained unchanged.

Techno Drugs Limited ranked top gainer on DSE, the share price increased by Tk 3.10 paisa or 9.72 percent. On this day, the share was last traded at Tk 35.00 paisa.

BD Thai Aluminium Limited ranked top loser on the DSE, the share price dropped by Tk 0.60 paisa or 3.00 percent. On this day, the share was last traded at Tk 19.40 paisa.

DSE topped on trade is Sea Pearl Beach Resort & Spa Limited 15 crore 86 lakh takas of company shares have been traded.

A total of 31 companies’ shares were traded in the Block on Dhaka Stock Exchange. A total of 1 crore 6 lakh 61 thousand 203 shares of the companies were traded. The financial value of which is 31 crore 82 lakh taka

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Asian markets drop with Wall St as Biden sparks fresh chip fears

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Asian markets sank with Wall Street on Thursday after a warning from the White House that it would target firms supplying China with key semiconductor technology, and Donald Trump’s comments on crucial chip supplier Taiwan.

The dollar remained subdued following its latest retreat caused by growing expectations that the Federal Reserve will cut interest rates at least once this year.

Firms linked to artificial intelligence have led a surge in equities this year as investors see the sector as the next major growth area, with market darling Nvidia piling on more than 140 percent since the start of the year.

The industry has helped push the S&P 500 and Nasdaq to multiple records in the past seven months, helped by the prospect of lower borrowing costs.

But the rally took a blow Wednesday when Bloomberg News reported that Joe Biden was looking at imposing strict curbs on firms such as Tokyo Electron and ASML if they continue allowing Beijing access to their chip tech.

The report, which comes as he looks to buttress his credentials as strong on China ahead of November’s presidential election against Trump, sent shivers across trading floors, sending the Philadelphia Semiconductor Index plunging nearly seven percent — its heaviest loss since 2020.

Nvidia dived more than six percent and Dutch firm ASML collapsed more than 12 percent.

Tokyo Electron fell 7.5 percent on Wednesday and a further 9.5 percent Thursday. TSMC shed more than three percent in Taipei.

Meanwhile, Trump’s comments that Taiwan — home of the key chip-maker TSMC and other major producers — should pay the US for its defence caused some geopolitical unease.

The fear fuelled a sell-off across Asian equities, with Tokyo and Taipei down at least two percent, while there were also hefty losses in Hong Kong, Shanghai, Sydney, Seoul, Singapore and Manila.

Analysts warned that the imposition of more chip restrictions could fuel further selling and lead to a correction in markets, which some warn have become overbought.

– ‘A big currency problem’ –

Worries over tech have offset the feel-good mood that has been sparked by recent data and comments from Fed officials indicating they are ready to cut interest rates as soon as September, and possibly again before January.

The latest boost for doves came in the central bank’s Beige Book summary of the economy, which said there were signs it was slowing.

“Expectations for the future of the economy were for slower growth over the next six months due to uncertainty around the upcoming election, domestic policy, geopolitical conflict, and inflation,” the report said.

The prospect of lower rates has weighed on the dollar, while the yen — which has been battered against the greenback this year — has won support from bets on a Bank of Japan hike in coming months.

“Markets are pricing in the Fed to start cutting rates in September, and risks of yen carry trade — the practice of borrowing low yielding currencies to invest in high yielding currencies — unwinding are building as yield gap narrows,” Saxo researchers said in a note.

“Recent comments from Trump have also hinted at concerns from US dollar strength.”

Trump, in Milwaukee for the Republican National Convention, has also weighed in on the dollar’s relative strength against the yen and yuan, telling Bloomberg Businessweek “we have a big currency problem” and “I would always notice they fought very hard to keep their currency low”.

Taylor Nugent, at National Australia Bank, said: “The comments play to the view (that) bilateral trade deficits and currency valuations are a key focus, and tariffs would be a key negotiating tool.”

Investors are keeping tabs on Beijing, where China’s leaders are expected to wrap up a key gathering, with hopes President Xi Jinping will unveil fresh measures to boost the world’s number two economy.

– Key figures around 0300 GMT –

Tokyo – Nikkei 225: DOWN 2.0 percent at 40,277.86 (break)

Hong Kong – Hang Seng Index: DOWN 0.5 percent at 17,652.42

Shanghai – Composite: DOWN 0.6 percent at 2,944.67

Pound/dollar: DOWN at $1.3007 from $1.3012 on Wednesday

Euro/dollar: DOWN at $1.0938 from $1.0941

Dollar/yen: DOWN at 155.92 yen from 156.33 yen

Euro/pound: UP at 84.09 pence at 84.07 pence

West Texas Intermediate: UP 0.7 percent at $83.39 per barrel

Brent North Sea Crude: UP 0.5 percent at $85.49 per barrel

New York – Dow: UP 0.6 percent at 41,198.08 (close)

London – FTSE 100: UP 0.3 percent at 8,187.46 (close)

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LafargeHolcim reveals their Q2 Financials

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One of the listed companies, LafargeHolcim Bangladesh Limited discloses its financial reports for the second quarter, (April – June 24).

The company’s Consolidated earnings per share (EPS) Tk 1.14 paisa in Q2 of the current financial year (April – June 24). Consolidated EPS was Tk. 0.69 for January-June 2024 as against Tk. 1.47 for the same period last year. EPS  was Tk 0.80 paisa during the same period last year. Consolidated NAV per share was Tk. 16.60 as of June 30, 2024.

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