Dhaka stocks suffered a steep fall on Wednesday, with the key index plummeting over 3 per cent to a nearly five-year low, as investors engaged in panic-driven sell-offs amid escalating geopolitical tensions between India and Pakistan.
DSEX, the benchmark index of the Dhaka Stock Exchange, shed 149.3 points, or 3.01 per cent, to close at 4,802 鈥� the lowest level since August 25, 2020.
The market opened in the red and continued to slide throughout the session, reflecting mounting investor anxiety.
The sharp decline was largely triggered by fresh tensions between the two South Asian neighbours.
According to international media reports, India launched missile strikes into Pakistani territory early Wednesday, reportedly killing several people. The development sparked fears of retaliation from Pakistan, intensifying concerns about regional stability.
Market analysts said that although Bangladesh was not directly involved, investors feared the regional volatility could have spillover effects on the domestic economy, trade and investor sentiment.
As a result, many opted to offload shares to avoid further losses.
Adding to the gloom, confidence in the market has steadily eroded since the new Bangladesh Securities and Exchange Commission under chairman Khondoker Rashed Maqsood took office in August 2024.
At that time, the DSEX index stood at 5,779 points.
Since then, the market has witnessed a persistent downtrend, driven by a lack of visible reforms and poor investor engagement, stakeholders said.
鈥業nvestors are increasingly disillusioned with the regulator鈥檚 inaction,鈥� said a top broker.
鈥楾here鈥檚 been no meaningful policy initiative to restore confidence or stabilise the market. People are simply losing money and giving up,鈥� he said.
In daily commentary, EBL Securities observed: 鈥楾he depressed capital market faced another blow as escalating geopolitical tensions in the neighbouring countries rattled investors, prompting them to liquidate holdings in order to avoid further capital erosions in their already hampered portfolios, consequently dragging the benchmark index down to a 5-year low.鈥�
Market breadth was overwhelmingly negative.
Out of 399 scrips traded on the DSE, only 9 advanced while 385 declined and 5 remained unchanged.
Turnover dropped to Tk 516.46 crore on Wednesday, compared with that of Tk 549.74 crore in the previous session, as investors rushed to exit positions.
All sectors except mutual funds ended in the red, according to brokerage data.
The DS30 index, comprising blue-chip stocks, dropped by 10.27 points, or 0.55 per cent, to close at 1,833.76.
The Shariah-compliant DSES index also slid by 9 points, or 0.82 per cent, to close at 1,089.