Small investors smell a rat in stock market storm

Posted by BankInfo on Sun, Jan 23 2011 08:46 pm

Small investors Sunday urged the government to take "immediate" steps to bring back traders' confidence, which has shattered after the tempest in the stock market.  They also demanded the closure of the capital market unless atmosphere in bourses is back to normal. The demand came at a press briefing by Bangladesh Share Investors' Association (BSIA), a platform of small investors, in the city, where stock traders placed a 15-point demand. Share trading on Dhaka Stock Exchange (DSE) was halted since Thursday following a 600-point fall in five minutes in share prices. Anarchy reigned in the city's financial district Motijheel, where law enforcers had to clash with thousands of retail investors and riot police. The investors censured the circuit breaker system for its failure to stabilise the market and said the procedure should be stopped because the DSE authorities are not well-equipped to handle it.

"The government must take proper steps to bring back investors' confidence as early as possible," BSLA convener Mizan-Ur-Rashid Chowdhury said. He said that the Securities and Exchange Commission (SEC) and DSE had invited investors to invest in the market. "But now gamblers and vested quarters plundered our money like pick-pockets. We didn't expect that the 96-like debacle will be staged again," he added. The investors sought measures to ensure participation of traders in each meeting before taking any stock market-related decision. They also demanded cancellation of share trading session that took place on January 20 as it crossed the index circuit breaker limit of 225 points by hitting at 600 point. The leaders of the organisation also raised questions about the responsibility of merchant banks, institutional investors and state-owned investment bank - ICB as they acted like small investors when the market had consecutive fall.

"The market has become unstable due to the conspiracy by a vested quarter," BSLA co-convener M Zihad Jahangir Alam said. He urged the authorities to investigate into BO accounts transacted over the last 30 days to find out whose accounts traded "unusually". "Punitive action must be taken against those who are responsible for the recent market crash," he said. The grouping's other demands include cancellation of the premium system in any IPO and withdrawal of all cases filed against general investors.

News: Financial Express/Bangladesh/24 Jan 2011

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