Stocks in the country's bourses extended losing streak for the second straight day on Wednesday as the investors booked profit on large-cap stocks, and also due to the gloomy US inflation report for August.
DSEX, the prime index of the Dhaka Stock Exchange (DSE), went down by 50.41 points or 0.77% to settle at 6,487.
Two other indices also closed lower. The DS30 index, comprising blue chips, plunged 20.27 points to finish at 2,333 and the DSE Shariah Index (DSES) fell 9.42 points to close at 1,417.
Turnover, a crucial indicator of the market, dropped to Tk1,304 crore on the premier bourse, which was 12% lower than the previous day's tally of Tk1,480 crore.
Losers took a strong lead over the gainers, as out of 371 issues traded, 175 closed lower, 72 higher and 124 others remained unchanged on the DSE trading floor.
Orion Pharma became the most-traded stock, followed by Beximco, JMI Hospital Requisite Manufacturing, LafargeHolcim, and Malek Spinning Mills.
Scam-hit International Leasing & Financial Services was the day's top gainer, soaring 10% while Fareast Islami Life Insurance was the worst loser, losing 6.19%.
The Chittagong Stock Exchange (CSE) also fell sharply with the CSE All Share Price Index (CASPI) losing 179 points to settle at 19,053 and its Selective Categories Index (CSCX) shedding 108 points to close at 11,420.
Of the issues traded, 147 declined, 43 advanced and 72 issues remained unchanged.
The port-city bourse traded 5.25 million shares and mutual fund units with a turnover value of Tk21.4 crore.
Global bourses
Global equities also sank further Wednesday as stronger-than-expected US inflation data sparked fears of a prolonged campaign of Federal Reserve interest rate hikes.
London was the heaviest faller in Europe after news that UK inflation slowed last month but held close to a 40-year high, reports AFP.
Asia tanked after Wall Street took its worst beating in weeks Tuesday on news of hot US inflation.
The dollar edged down in choppy trade, while oil prices were mixed Wednesday.
US inflation slowed slightly in August to 8.3%, but this trumped market expectations of about eight percent.
'Caught up'
European markets are "caught up in the negative sentiment that has taken hold across global markets," said Victoria Scholar, head of investment at Interactive Investor.
Hotter-than-expected US inflation figures prompted heavy selling on Wall Street, she added.
Global consumer prices have soared for months, exacerbated by Russia's invasion of Ukraine -- which has hiked energy and food costs -- as well as owing to supply chain strains and Covid lockdowns in China.
The Fed has already instituted two consecutive 75-basis-point hikes, and a third such move is widely expected at its meeting next week.
After the latest US inflation data, some investors are even predicting the next Fed hike could be a full percentage point.
Aggressive rate tightening by central banks worldwide is denting economic activity as consumers and businesses face higher loan repayments.
In the UK, inflation slowed to 9.9% in August but remained almost in double digits.
The news boosted the pound on hopes of another interest rate hike next week from the Bank of England.
"There has been a fresh bout of anxiety on financial markets amid worries that inflation is still proving to be a formidable opponent to take down," said Hargreaves Lansdown analyst Susannah Streeter.
In Asia, Tokyo led the region's losses with the Nikkei plunging 2.8%.
Hong Kong stocks closed down more than 2%, with Chinese conglomerate Fosun hit hard by media reports that the group was under regulatory scrutiny.
US August inflation
US annual inflation slowed slightly in August, largely thanks to falling gasoline prices -- but likely not enough to satisfy the Federal Reserve and President Joe Biden, as high prices continue inflicting pain on Americans.
The consumer price index (CPI), a key measure of inflation, actually rose 0.1% in August compared to July, when prices were flat, the Labor Department said Tuesday, a disappointing result amid widespread expectations that inflation would fall in the month.
The annual inflation pace improved to 8.3%, higher than expected but slightly below the prior months and confirming a slowdown from the blistering 9.1% rate in June -- the highest in 40 years.
Prices have been soaring for months, exacerbated by the Russian invasion of Ukraine, which has impacted energy and food costs, as well as ongoing supply chain snarls amid Covid lockdowns in China.
Inflation has become a hot political issue just weeks away from key midterm congressional elections, and Biden has made fighting high prices his top domestic priority.
But he acknowledged Tuesday that it will take longer to slow inflation pressures.
"Today's data show more progress in bringing global inflation down in the US economy. Overall, prices have been essentially flat in our country these last two months," Biden said in a statement.
However, "it will take more time and resolve to bring inflation down."
While Americans will welcome relief at the pump -- there has been a steady drop in gasoline prices, which fell 10.6% last month -- costs for food and housing continue to rise, straining family budgets.
The food index increased 11.4% over the last year, the largest 12-month increase since the period ending May 1979, the report said.
Medical care also has been a key contributor, and auto prices have accelerated, rising 0.8% in the month, according to the report.