Bangladesh police fired tear gas and water cannon to break up violent protests by investors today after stock trading was halted when prices went into free fall.
The benchmark index shed 9.25 per cent in less than an hour of trading, its steepest-ever slide. That followed a 6.7 per cent drop on yesterday after the market had been battered for weeks.
Hundreds of angry investors vandalised cars and blocked roads around the Dhaka Stock Exchange, the main bourse, before police moved in.
Investors chanted slogans complaining of manipulation of stock prices by dishonest brokers and traders. Stock market executives and regulators declined to comment on the accusations but are due to give a news conference later in the day.
Prices of shares have suffered a series of slides since early last month after the stock regulator and the central bank took measures to cool the market, prompting some street protests. The benchmark index has lost more than 27 per cent since December 5th.
The central bank had raised banks' cash requirement ratio from 5.5 per cent to 6 per cent, effective December 15th, to rein in inflation and to curb runaway credit flow, especially to the volatile capital markets.
Call money market rates also hit a record high last month. Some banks have invested 75 per cent of their deposits in the stock market against a ceiling of 10 per cent and had been told to get back under the limit by December 30th. This deadline has now been extended to January 15th.
Reuters