Alarming rise in Covid patients takes a toll on stocks

The stock market ended last week on a negative note amid fears of a new wave of the Covid-19 pandemic due to an alarming rise in the number of coronavirus-infected patients.

The DSEX, the benchmark index of Dhaka Stock Exchange (DSE), dropped 134 points or 3.41 per cent compared to that in the previous week to stand at 5,434 last week.

The overall trade value of stocks fell 24 per cent.

Owing to a rising number of infections, investors apprehend that the country could be in for a second round of lockdown, which means the stock market would also be kept shut, said a stock broker preferring anonymity.

Of 20,925 samples tested in Bangladesh in the last 24 hours till 8:00am yesterday, at least 2,187 tested positive for coronavirus, pushing the infection rate to 10.45 per cent, according to a press release of the Directorate General of Health Services (DGHS).

The situation is so bad that the DGHS proposed going for a complete lockdown on Wednesday to curb the spread.

In the last 10 days, the transmission of novel coronavirus had been gradually rising every day around the globe with experts fearing spread of new strains of the pathogen, including those first detected in the United Kingdom and South Africa.

The spread of such news created a rumour that the stock market may be kept shut again, leaving a negative impact on the market, said an industry insider.

"This rumour created panic among the investors," he added.

However, the Bangladesh Securities and Exchange Commission yesterday said if the banks were kept open, so would the market.

Meanwhile, Health Minister Zahid Maleque said there would be no need for a lockdown now if health safety guidelines were maintained.

The government agencies will jointly take a decision on imposing a lockdown, he told a ceremony honouring 10 nurses for their contribution during the initial coronavirus crisis at the KIB auditorium in Dhaka.

The rise in infections is really a cause of tension because it may affect the economy again, said a top official of an asset management company.

If the government announces a general leave again, many companies will face serious problems, he said.

Along with the benchmark index, the premier bourse's turnover also fell last week when the daily average turnover dropped 24 per cent to Tk 656 crore.