South Asia Stocks 2021: Lanka, BD and India most vibrant PAK dull
January 6th, 2022 at 7:18 pm
South Asia Stocks 2021: Lanka, BD and India most vibrant PAK dull

by Julia Alam in Dhaka,   

Sri Lanka: Stocks of the Island nation gained 80.5 percent in the 2021 with market registering record number of Initial Public Offers or IPOs.

The Lankan stock market drew attention also from global business media as stock indices and trades soared despite country’s macroeconomic indices, including forex reserve and inflations remained not favourable. But, with Covid-19 situation eased, exports revived and corporates reported good health of their business, investors flocked to stocks.

On the 31st of December, the country’s top stock index closed at 12,226.01 points against 6774.22 on same day in 2020.

However, in the just ended year, the Lankan bourse saw net foreign fund outflow of 51.8 billion rupees compared with net inflow of 22.8 billion.

Meantime, Hong Kong based Asia Frontier Fund, said in Bangladesh and Sri Lanka 2021 was good year for small and mid-cap stocks but large-cap stocks might be doing better in 2022.

Bangladesh: The Dhaka Stock Exchange benchmark DSEX, advanced by 25.08pc and closed at 6,756.65 points on the last trading day in 2021. Mentionable here that DSEX-30, the key index of the country major bourse, hit record 7,367 points on 10th of October of the same year. In 2020, it had gained 950 points.

The daily average DSE turnover amounted to BDT 1,475 crore in 2021 against BDT 6.49 billion in 2020. In 2020, DSE market capitalisation increased by 20pc or BDT 940 billion and totalled at BDT 5,860 billion which is equivalent to US$66 billion. Expansionary monetary policy, low interest rates on banks for depositors, idle money of investors, due to less economic activities during pandemic, were lured to the stock market. 

Growing participation of investors with various regulatory measures and favourable macro-economic conditions, kept the market vibrant in most of the period of the years. 

India: Indices of Indian stocks ended 2021 with a gain of over 20%, despite benchmark indices corrected more than 10% from lifetime highs on October 19 at 62,245.43 points. The major index Sensex gained 10,054 points between January 1 to December 29, 2021 and this is the best among big Asian economies and second-best performance in the world.

As of December 28, 2021 net foreign investment in Indian stock market is just INR 26,0 billion. The figure was Indian Rupees or INR 1000 billion plus in 2020 and 2019. While India investors took out profits INR 54,0 billion from the markets in just ended year injecting investment amounting INR 82,3.4 billion. In 11 months of the year, 27.4 million new demat accounts were opened against below 10 million every year until 2020.

Pakistan: In Pakistan the benchmark index PSX, ended at 44,596.07 on 31st of December, with just 0.40% annual increase. In January, it begun at 44,434.80 points. However, average daily trade rose to at Rs 16.9 billion compared to Rs12.3 billion in previous year. The Karachi Stock Exchange benchmark KSE-100, instituted with top companies, rose by only 1.9% during the year. Eight initial public offerings (IPOs) raised around Rs 20 billion from market of the South Asian nation.

Nepal: In Nepal, stock market saw volatility during 2021 but Indices there rose. With annual gain of 437.23 point, the benchmark at The Nepal Stock Exchange (Nepse), closed at 2,524.50 points. The market capitalization at the country’s only bourse amounted to Rs 3.567 trillion on the last day of the past year. Indices was at highest of 3,227 points in August with rise of enthusiasm of the domestic investors. The number of demat account holders increased to around 4.7 million from mere 1.5 million in the previous year. Nepal stocks saw declines in the ending months of the year. Brokers and stock experts pointed out that soaring interest rates, liquidity crunch in banks, and allegation against bosses or regulators on insider trading hit the sentiment of the investors.

Julia Alam is a Bangladeshi journalist writing on economic affairs