BANGLADESH NEWS
Breaking his long silence over the capital market, Finance Minister Abul Maal Abdul Muhith said on Wednesday that the recent fluctuations in the indices are 'illogical'.
"I expect the stock market to follow logic… It's rising one day and falling the day next," he said at a meeting with the Dhaka Stock Exchange executive council members and officials, and the Securities and Exchanges Commission (SEC) chief at the Secretariat aiming to find a solution to the recent market situation.
The finance minister had faced massive criticism from individual investors and ruling party MPs last year during the market instability for his comments about the investors.
After that he declared at a meeting on June 19 last year, "I do not want to talk about this ... whenever I speak, the market falls."
Downtrend ruled the market all through the last month, and the DSE general index fell to 4,828 points over the last two days, losing 194 points.
The SEC is working to stabilise the market and the government is giving its all-out support, the minister pointed out.
DSE chief Rakibur Rahman pointed out, "The market is now running with only retail [small] investors. It is not possible to stabilise the market with only retailers."
He continued that institutional investment has fallen in the market and even though banks can invest up to 10 percent, their investment is less than two percent.
"We have to see if the merchant banks and mutual funds are carrying out their responsibilities," he added urging Muhith to work to increase institutional investment.
Responding to a bdnews24.com query, the DSE chief said: "If they are not doing so, we will have to cancel their licences."
Hinting at amendment of the Bank Company Act, the DSE chief said, "We will have to keep a watch so that the limit of investment for banks is not lowered while making the changes."
Meanwhile, SEC chief M Khairul Hossain pointed out that the petitions by a number of directors challenging their directive about minimum stake to be held by directors had caused a fall in confidence of investors.
On Monday, the High Court scrapped three such petitions and upheld the SEC's Nov 22 directive mandating directors to hold minimum two percent and all sponsor-directors together to hold a total 30 percent.
Five were filed on Tuesday, but the judge did not accept them and sent them to the Chief Justice.
Hossain blamed the new petitions for the fall over the last two days. "This is happening for the lack of confidence. We have seen in our surveillance that the market is not being downed through aggressive selling."
"I expect the stock market to follow logic… It's rising one day and falling the day next," he said at a meeting with the Dhaka Stock Exchange executive council members and officials, and the Securities and Exchanges Commission (SEC) chief at the Secretariat aiming to find a solution to the recent market situation.
The finance minister had faced massive criticism from individual investors and ruling party MPs last year during the market instability for his comments about the investors.
After that he declared at a meeting on June 19 last year, "I do not want to talk about this ... whenever I speak, the market falls."
Downtrend ruled the market all through the last month, and the DSE general index fell to 4,828 points over the last two days, losing 194 points.
The SEC is working to stabilise the market and the government is giving its all-out support, the minister pointed out.
DSE chief Rakibur Rahman pointed out, "The market is now running with only retail [small] investors. It is not possible to stabilise the market with only retailers."
He continued that institutional investment has fallen in the market and even though banks can invest up to 10 percent, their investment is less than two percent.
"We have to see if the merchant banks and mutual funds are carrying out their responsibilities," he added urging Muhith to work to increase institutional investment.
Responding to a bdnews24.com query, the DSE chief said: "If they are not doing so, we will have to cancel their licences."
Hinting at amendment of the Bank Company Act, the DSE chief said, "We will have to keep a watch so that the limit of investment for banks is not lowered while making the changes."
Meanwhile, SEC chief M Khairul Hossain pointed out that the petitions by a number of directors challenging their directive about minimum stake to be held by directors had caused a fall in confidence of investors.
On Monday, the High Court scrapped three such petitions and upheld the SEC's Nov 22 directive mandating directors to hold minimum two percent and all sponsor-directors together to hold a total 30 percent.
Five were filed on Tuesday, but the judge did not accept them and sent them to the Chief Justice.
Hossain blamed the new petitions for the fall over the last two days. "This is happening for the lack of confidence. We have seen in our surveillance that the market is not being downed through aggressive selling."
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