After the Bangladesh Securities Exchange Commission (BSEC) lowered the limit of the circuit breaker to stop the free fall of the index, general stock investors in Bangladesh rushed to buy their stocks.
As a result, the index returned to the rising trend in the country's stock market on Thursday. Shares and unit prices of most companies rose on the day.
The BSEC reduced the lower limit of the circuit breaker from Thursday so that no stock can fall more than 2% in a day. Meanwhile, the upper circuit breaker remained at 10%.
Experts and market insiders think that because of this decision, the market came to an upward trend.
Shafique Rahman, who has been doing share business since 2002, told Dhaka Tribune: “The decision regarding circuit breaker limit gave confidence to retail investors and the index of the market rose. I saw more interest from general investors to buy shares today.”
“However, it is difficult to say whether it will continue even after the closure,” he added.
Abu Ahmed, a stock market expert, does not think that this trend will last long.
He said: “There is no such system in any country of the world where the share price can increase by 10% but cannot decrease by more than 2%. Due to such ridiculous rules, foreigners are selling shares and withdrawing investment.”
This expert called on the regulators to let the market run as it wants without any interference.
DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), rose 50 points, or 0.81%, to 6,237 on Thursday.
At the DSE, 273 stocks advanced, 61 declined and 40 remained unchanged.
Meanwhile, both the DS30, the blue-chip index, and DSES, shariah based index, advanced by 19 points and 10 points respectively.
Turnover of the DSE also rose to Tk539 crore from the previous day's Tk513 crore.
Imam Button topped the gainers' list, which rose 9.93%. Emerald Oil, Apex Tannery, Lub-Rref Bangladesh and Libra Infusions are also on the list.
Pioneer Insurance shed mostly with a drop of 10%. National Life Insurance, Phoenix Insurance, Fareast Finance and Silco Pharmaceuticals are among the other companies in the loser tally.
Beximco Ltd became the most traded stock with shares worth Tk60 crore changing hands followed by IPDC Finance, Fortune Shoes, Bangladesh Shipping Corporation and BD Finance.
Although the index of Chittagong Stock Exchange (CSE) increased, the overall transaction decreased.
Shares of 255 companies and mutual funds have been traded in this market. Of these, prices of 132 have increased, 88 have decreased and 35 have remained unchanged.
The market turnover on Thursday was Tk13.72 crore, Tk1.51 crore less than the previous day. Shares worth Tk15.13 crore were traded on Wednesday.
Earlier, the regulator reduced the lower limit to 2% on March 8 to stop the market fall.
Later, the BSEC set the lower limit at 5% on April 20, and finally the limit was reduced to 2% on Wednesday.
After the Covid-19 outbreak, the securities regulator introduced floor prices on March 19, 2020, and the prices of listed securities were not allowed to go down below their respective floor prices.
Later, the BSEC lifted floor prices of all listed securities on June 18, 2021, after the market returned to normalcy.