The Bangladesh Fund, a Tk 5000-crore open-ended mutual fund launched by eight state owned institutions, on Monday prevented the market from plunging massively for the second day by purchasing shares worth Tk 27 crore, ICB sources said.
On Monday, the general index of Dhaka Stock Exchange closed the day in a positive territory, gaining by 27.33 points or 0.48 per cent, thanks to late buying by the fund after the key index lost 366 points in the first two sessions of the day's trading.
Market operators said the general investors went for sell-offs from the opening bell, resulting in heavy fall in share prices. But the Bangladesh Fund started to buy shares from the midday trading and the move pulled the market, they said.
'We were trying to lift the market in the last two days, but we got positive result today [Monday],' Md Fayekuzzaman, managing director of the Investment Corporation of Bangladesh, told New Age.
Currently the fund holds Tk 500 crore and soon they will collect the rest of the sponsors' fund which is Tk 1,000 crore, he said.
When asked whether their efforts would be enough to keep the market afloat, he said, 'We will
try our best to stablise the market.'
General investors in the last two days staged rowdy demonstrations in front of the DSE building, protesting the free fall in share prices. Investors also criticised the role of the Bangladesh Fund as many of them injected fresh funds, banking on the hype created by the fund.
On March 6 the ICB, the prime sponsor of the fund, announced the formation of the fund to stabilise the volatile capital market. The formation and the launching of the fund raised the level of the confidence of the general investors who were in despair situation after the January stock market debacle.
A stock market analyst said the Bangladesh Fund could be an important addition to the market if it could contribute to the market according to the need of the market.
'The Bangladesh Fund can play a key role in this situation if it is used properly,' said Akter H Sannamat, a stock market analyst.
The amount of the fund is very big and it should be handled carefully, he said.
The fund should collect the rest of the sponsors' amount immediately, he added.
Source: New Age
