Stock Market Desk: Net foreign investment in the Dhaka bourse has been on a downward trend for the last one year as the overseas investors continued to pull out their fund amid prolonged bearish market trend.
The foreign investors withdrew a total of Tk 12.90 billion in the past 12 consecutive months, according to statistics from the Dhaka Stock Exchange. In line with the declining trend in 2019, net foreign funds was Tk 1.28 billion in negative and Tk 1.75 billion in January and February in 2020 respectively.
The foreign investment data of March, 2020 was not available as the stock market remained closed due to coronavirus pandemic. In January 2020, the overseas investors bought shares worth Tk 2.74 billion while they sold stocks worth Tk 4.02 billion, taking the net position of Tk 1.28 billion in the negative, the DSE data showed.
The net foreign fund was Tk 1.75 billion in negative in February 2020, as they sold shares worth Tk 3.67 billion against purchasing of Tk 1.92 billion. Market analysts said the foreign investors were selling off their shares due to the lack of confidence, depreciation of local currency against the US dollar and concern over the country’s financial sector.
Investors confidence was affected due to some policy changes and gloomy macroeconomic outlook, said an analyst. He noted that lack of depth of the stock market, financial market volatility, poor regulatory control, approval of weak IPOs (initial public offerings) also dented foreign investors confidence in the country’s capital market.
Banks and financial institutions shares were the top choice of foreign investors, who also are also attracted in power and energy, telecom, pharma, multinational companies and IT companies.
