The benchmark equity index retreated marginally at the end of the first trading week of 2023 as there is no sign of economic pain ending anytime soon.
Buying activity remained subdued as investors are worried over what the country's economic condition will be in the coming months though remittance and export earnings rose last month, said a leading merchant banker, requesting anonymity.
Investors fear that the performance of listed companies may fall due to a rise in the prices of raw materials and the exchange rate of the US dollar with taka, he said.
"A crisis of confidence still prevails among all investors," he added.
On Wednesday, the Bangladesh Securities and Exchange Commission, at a meeting with stakeholders, assured that floor price won't be withdrawn until the market gets the due momentum, but it failed to bring back the investors from the sidelines.
Of the five trading days this week, three sessions suffered losses while two managed to close in the green.
DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), settled the week 12.85 points, or 0.21 per cent, lower at 6,194. It gained 4.60 points in the week before.
Market insiders said the ongoing depressed market situation, liquidity crunch and lack of institutional participation altogether severely dented the investor confidence.
Buyers had been concentrated on selective stocks while the majority of stocks remained stuck at the 'floor price' level as investors deemed the reference price overvalued.
Though the regulator has brought some changes last month, they turned out to be impediments to attracting investors. Rather, single-day turnovers fell to a 30-month low several times.
The large-cap stocks, which dominated the market earlier, remained unmoved due to limited liquidation opportunities, making investors reluctant to inject fresh funds.
Most big companies with excellent reputations such as British American Tobacco, Grameenphone, Renata, and Singer Bangladesh are failing to attract investors amid the current gloomy economic scenario.
Of the 382 issues traded, 133 declined, 44 advanced and 205 issues remained unchanged on the DSE trading floor.
The week's total turnover amounted to Tk 11.33 billion, up from Tk 10.72 billion in the previous week as last week saw five trading days instead of previous week's four.
And the daily turnover averaged out at Tk 2.26 billion, down 15 per cent from the previous week's average of Tk 2.68 billion.
Most of the investors remained pessimistic and reluctant to make fresh investments in the stocks as the investors failed to find any clear direction about the future market movement, said International Leasing Securities.
Also, they remained cautious about the macroeconomic indicators like inflation, interest rate and dollar crisis in 2023, it said.
The market witnessed volatility since sellers dominated the trading floor as investors perceived every bounce back as an opportunity to exit the bearish market, EBL Securities said.
Investors' willingness to take a long-term position in equities has weakened owing to the dismal performance forecasts of the listed companies due to adversities on the macroeconomic front, it said.
The pharma sector dominated the turnover chart, grabbing almost 23 per cent of the week's total turnover, followed by IT (11 per cent) and engineering (9.5 per cent).
Orion Infusions became the week's turnover leader with shares worth Tk 719 million changing hands, followed by Intraco Refueling Station, Sea Pearl Beach Resorts, Bashundhara Paper Mills and Monno Ceramic Industries.
Newly listed Islami Commercial Insurances was the week's top gainer, soaring 60 per cent while Orion Infusions was the worst loser, shedding 20 per cent.
Two other indices of the DSE also edged lower. The DS30 Index, comprising blue-chip companies, shed 1.90 points to close at 2,193 and the DSES Index lost 5.55 points to finish at 1,353.
The Chittagong Stock Exchange (CSE) also ended lower with the CSE All Share Price Index (CASPI) losing 30 points to settle at 18,298 and its Selective Categories Index (CSCX) shedding 17 points to close the week at 10,965.
