The Dhaka stocks finished lower for the fourth consecutive session yesterday as investors adopted a wait-and-see approach amid speculations that the central bank may tighten money flow to curb credit growth.
The benchmark index, DSEX, declined 11.97 points or 0.19 percent to 6,198.53. Turnover decreased 6.16 percent to Tk 448 crore from the previous day.
Bangladesh Bank plans to reduce the advance deposit ratio in the new monetary policy for January-June of 2018 to be announced this month, a senior executive of a merchant bank said.
The move will interrupt the money flow to the capital market, he said.
The merchant banker also said many banks are offering higher interest rates for large fixed deposits, which affected the daily turnover.
The turnover stayed below the Tk 500-crore level in the last three sessions.
The aggressive lending by banks pushed up the private sector credit growth to 19 percent in November in a worry for the central bank, as the growth rate was way above the target of 16.2 percent set for the July-December period of 2017.
The stockmarket started the session on a positive note but soon fell due to correction in nearly all the sectors.
Textile equities led the turnover, accounting for 20.23 percent of the total. Among the major sectors, pharma gained 0.45 percent while banks dropped 0.35 percent.
Dragon Sweater and Spinning Ltd became the highest traded share of the day with its stocks worth Tk 19.35 crore changing hands, followed by United Power with securities worth Tk 17.79 crore.
However, it was a mixed day for Dragon Sweater.
Bangladesh Securities and Exchange Commission (BSEC) has fined the sweater exporter Tk 30 lakh for misusing its IPO (initial public offering) proceeds.
The decision was taken at a commission meeting yesterday.
Dragon Sweater faced the penalty less than two years after making debut on the Dhaka Stock Exchange in March 2016.
The exporter used 53.62 percent of the IPO proceeds of Tk 40 crore as cash but did not show it in the financial report, breaching the securities laws, according to a BSEC statement.
Moreover, the company did not buy machinery and implement project as per its IPO declaration, according to the BSEC. In the IPO prospectus, Dragon Sweater said it would spend Tk 15.82 crore for machinery imports, Tk 18.31 crore for building construction, Tk 1.13 crore for business operations and Tk 2.97 crore as working capital.
Swadesh Investment Management Ltd acted as the issue manager during the IPO.
Dragon Sweater’s shares traded at Tk 21.30 on the DSE yesterday.
The regulator also fined M Securities, a brokerage house, Tk 10 lakh for various irregularities and breaches of rules.
The brokerage house was penalised because of a shortfall in customer account and for providing margin loan against “Z’ category shares in violation of rules, the commission said.