This was caused mainly by the panic-selling by investors as they might have thought that coronavirus might damage our economy
The Bangladesh Capital Market was severely affected after three cases of coronavirus infection were identified in the country on Sunday.
The news resulted in a huge 279 points fall in the DSE index and 769 in the CSE index in a single trading session on Monday.
This was caused mainly by the panic-selling by investors as they might have thought that coronavirus might damage our economy.
After the sharp fall in the index, the market looks much cheaper in terms of market P/E ratio, which is around 10 or less than 10 at this stage.
Many stocks look much cheaper considering their future potential and business outlook.
As Bangladesh is a growing economy with the aspiration of becoming a developed country by 2041, we believe our capital market will grow at the same pace as our economic growth.
We have already learnt that the main country, China, where the coronavirus outbreak originated, has already controlled the virus attack successfully, and the people there have returned to their normal lives except in Wuhan province. They also reported the lowest number of new infections in a single day recently.
We can assume that trade between China and Bangladesh will normalise soon, and that the global economy will also follow in the same direction.
Moreover, recently Bangladesh Bank released a directive regarding capital market investment, where a bank can invest up to Tk200 crore on their own and through their subsidiaries, and the investment will not be considered as banks' capital market exposure either through solo or consolidated basis.
As far as I know, a few banks (around 10) have started the process of getting approval from their boards and the regulator, and are in the process of investing fresh funds into capital market.
I humbly request the board of directors & the senior management of the banks who are yet to start their process under this directive, to please step up and start your process and make your investment in to this market as soon as possible.
Asif Ibrahim is the Board Chairman of Chittagong Stock Exchange