DSE slides after SEC places GP, Marico in 'spot market'

FE Report

Dhaka stocks fell more than one per cent Thursday after the securities regulator ordered cash trading of Grameenphone and Marico shares in a desperate bid to rein in spiraling prices of the multinational companies.

The market lost 176 points -- or more than three per cent -- in the first hour as news filtered that the Securities and Exchange Commission has placed the two heavyweight shares in the 'spot market', meaning their stocks now only be sold or bought by cash.

Under the spot market, trading settlement period of a share is only one day while in the public market -- where the GP and Marico stocks have been trading since their debut-it can be settled in three days.

The market recovered some of its lost ground later in the day when nearly three per cent gain by banking shares halted the slide, with the DSE General (DGEN) - the main gauge of the market - ending the week 67.43 points or 1.15 per cent down to 5760.94.

During the bumpy trading session, the DGEN fell to 5652.63 points, which was the lowest since February 11.

The broader All Shares Price Index (DSI) lost 50.73 points or 1.06 per cent to 4719.41, while the DSE 20 blue chip index gained 39.12 points or 1.26 per cent to 3125.58.

The SEC move comes as shares of Grameenphone, the country's largest private company in terms of revenue, rose 23 per cent in the first four days of the week - a climb seen 'abnormal' by the regulators.