If we knew how things going to end or where our journey would take us, do you still make the same decisions? Or would we choose a different path? Can we even escape our fate? Or something what is deep within us lead us to the same end, like an invisible hand?

All of those questions must arise in the mind of investors, regulators and market markets during the longest bearish market trend of the Dhaka bourse. When most of the pandemic-hit markets had been hovering near their historic high level, or at a merely corrected price level. Stock markets in the United States, Europe, India, or even in Pakistan – all came through a prosperous journey after the global financial crisis a decade ago. Investors in Bangladesh are yet to heal the wounds from the 2010-11 market crash as the overall market is still depressed and gradually deteriorating.

For the last couple of years Two bourses, Dhaka Stock Exchange Ltd (DSE) and Chittagong Stock Exchange Ltd (CSE), who operate in the capital market of Bangladesh shows same type of downtrend. Even after the DSE successfully secured a strategic partnership with the Shenzhen-Shanghai stock exchange consortium in 2018 – following its demutualization in 2013. Since then, the market has been bearish, and revenue from daily transactions has fallen drastically. Meanwhile, trading on the country’s premier bourse sank to its lowest level in 13 years on last June 21 with a turnover of Tk 38.64 as investors largely stayed away due to pandemic and floor price. The previous lowest turnover of Tk 40.39 crore was recorded on April 24 in 2007, data from the premier bourse showed.

Despite our overall economy has been growing the capital market showed continuously nosedive posting a negative growth throughout the year 2019 while bourses in other neighboring countries and emerging Asian countries posted growth in the period. In the year 2019, the return at Indian key index, SENSEX, was 14.70 per cent, followed by 10.70 per cent of Pakistani KSE100, 8.10 per cent of Vietnamese VNINDEX, 1.0 per cent of Thai SET and 2.30 per cent of Sir Lankan CSEALL. But Dhaka Stock Exchange (DSE) recorded negative index return of 17.30 per cent in last year among the Asian countries.

Like German philosopher Arthur Schopenhauer said, “Man can do what he wills, but he cannot will what he wills.” Every initiative from the Government, Authorities seems unsuccessful.

But, once a wise man said, “There was never a night or a problem that could defeat sunrise or hope.” After imposing celling to stop free fall of share price and after a 66-day break, due to Covid-19 pandemic market sentiment turns bullish. All credit goes to the new BSEC commission. Every step they are taking so far is hugely appreciated by the investors and the market makers.

Here are some important facts that’s fueling the long-awaited uptrend of the market:

On July 29, the central bank declared monetary policy for the next six months where bank rate was brought down to 4 percent from existing 5 percent. Bangladesh Bank already announced MPS for the next twelve months. The key takeaway is the reduction in repo rate from 5.25% to 4.75%. This is the third reduction in policy rates since March 2020. It is clear that Bangladesh is getting into an interest rate regime it has not seen before. High quality local banks are offering term deposit rates that are below inflation rate (4.5% vs 5.5%). The government treasury yields reflect this new normal (90 days Bills yield 4.45%). However due to a lack of well-developed corporate bond market we are unable to see the impact on corporate bond yields and credit spreads. The Bangladesh Bank also set a 14.8 growth target for the private sector and 44.4 percent for the public sector in the monetary policy.

While talking to a few asset managers and investment bankers, it was learned that institutional investors can now get money at a cheaper rate for investing in the capital market.

One thing is for sure. 2020 is suddenly looking quite a bit more interesting. Until recently, it was all gloom and doom but the last few days look promising. Who would have guessed that FX reserves will increase by US $4bn in a couple of months during this pandemic? That is more than 10% increase in reserves.

The official data recently released by the Bangladesh Bureau of Statistics confirming 5.24% economic growth in the last financial year ending in June should be considered as a “great news” in the time of the coronavirus pandemic when global economies are experiencing the worst crisis since the Great Depression in the 1930s.

That should be a “great news” because the growth rate negated the chilling forecast made by the World Bank in June that Bangladesh’s GDP growth would come down to only 1.6% from a high flying 8.15%.

The $3.9 billion export in July brought a glimmer of hope about a V-shaped recovery. A positive 0.6 percent growth relative to exports in July last year came after nearly eleven months of sustained year-on-year decline with the sole exception of December 2019. According to the countries well known economist Dr. Zahid Hussain, A V-shaped recovery in Bangladesh’s exports depends foremost on the state of health in the global and domestic economy. Assuming the bottom is past, recovery will also depend on how the global multilateral trading system morphs.

The United Kingdom’s Department for International Department (DFID) has launched a new funding to protect workers in developing countries supplying goods to the UK amid the Covid-19 fallout threatening global supply chains.

Under the £6.85 million scheme, DFID will partner with businesses including Marks & Spencer, Morrisons, Primark, Sainsbury’s, Tesco, and Waitrose to improve conditions for workers in countries including Bangladesh, Ghana, and Rwanda, reports The Daily Telegraph.

The BSEC is planning to work on the junk stocks in three stages.

In the first phase, it will upgrade the companies that are very close to booking profits, or have large retained earnings or adequate cash flow.

There are two to five companies in this stage and a decision will be taken about them by checking the last few years’ financial reports, said Islam, who was previously the dean of the Dhaka University’s faculty of business studies.

In the second stage, the regulator will support the companies that are struggling but are making an honest effort to return to profit.

“And in the final stage, we will punish the worst performers by either changing their boards or by deploying administrators,” Shibli Rubayat-Ul-Islam said, who is the newly appointed chairman of BSEC.

The Bangladesh Securities and Exchange Commission (BSEC) has issued an ultimatum to 42 listed companies who failed to comply with the mandatory rule on joint ownership of a minimum of 30 percent shares in their firms’ paid-up capital. The commission has sent letters to the companies asking them to comply with the mandatory 30 percent shareholding rules within 60 days, sources said. The purchase of shares must be announced within 15 working days. If any company fails to comply with the rules within this time; the commission will take regulatory actions.

All those initiatives, incentives and news giving hope to the investors as famous actor Christopher Reeve (the superman of Hollywood) said, once you choose hope, anything’s possible.

New BSEC team wants to establish the concept that capital market is the main source of fund for industrialization. BSEC Chairman, Professor Shibli Rubayat-Ul-Islam pledged to give support to work with VCPEAB on policies to nurture the emerging industry. BSEC will Help Boost the Startup and Venture Capital Ecosystem. He also said, “Our stock market has remained only equity-based. I will focus on launching bond, debenture, Sukuk and alternative investment fund in the market”. He also wants to make DSE a ‘truly’ digitalized trading platform. All those promises and visions is helping all the interest parties gaining confidence and hope.
Hopefully, like Lotus, capital market will shows us the ability to rise from the mud! As Netflix new superhit “DARK” TV serial theory says “Der anfang ist die ende und der ende ist der anfang.” Means, the beginning is the end and the end is the new beginning.