Stock market opens lower on post-budget trading
09 June 2014
BSS, Dhaka :
Stock market opened lower on Sunday with all indices losing over 1.0 percent in 30 minutes as the first post-budget trading session began on the prime bourse.
DSEX, the benchmark price index of Dhaka Stock Exchange (DSE), fell to 4338.84 at 11:05 am in the morning when the blue-chip DS30 came down to 1595.67 and the Shariah DSES to 991.36. All the three indices, however, started showing little recovery after 11:30 am.
Dhaka Stock Exchange (DSE) ended week flat on Thursday, the day when the Finance Minister AMA Muhith unveiled the national budget for 2014-15 financial year at the Jatiya Sangsad.
Pre-budget cautious trading kept indices down with the major DSEX finishing at 4396.54, the DS30 at 1622.94 and the Shariah index at 1007.82.
Market observers said some negative reports in the media contributed to the early session fall on post-budget trading, but they believed the market would regain as the new budget proposed many good things to benefit the stock market and the investors as well.
Referring to the press conference of the DSE, held on Saturday, media today reported that the bourse authorities expressed concerned over the proposal of gain tax, which might evoke reaction in the capital market.
At the press conference, the DSE authorities also hailed the budget, terming it an investment-friendly one that would help revitalize the stock market. But, the proposal of tax at sources against capital gain from share selling got prominence in the media though the proposed tax measure would hardly impact small investors.
Finance Minister AMA Muhith in his budget speech proposed 3.0 percent tax at sources on capital gains of over Taka 10 lakh.
Apart from the minimal tax proposal, the finance minister proposed a five-year tax exemption for Dhaka and Chittagong stock exchanges to help the bourses accomplish their ongoing reform process, which would ensure more accountability and transparency in stock trading.
He also proposed to raise the ceiling of tax- free dividend income for individual investors from Taka 10,000 to Taka 15,000 for encouraging them to invest more in stock market.
