Few stock exchanges can claim to have had as eventful a 2011 as the Dhaka bourse. Following riots after a steep daily drop last month, the market has been no less fiery so far this year, with authorities suspending trading on Monday after a morning plunge of more than 9% in less than a hour saw investors (again) take to the streets. Just as dramatic, the exchange’s main index soared by more than 15% yesterday (and added another 2% today for good measure).

Following the demonstrations earlier this week, officials relaxed recently imposed rules on banks’ exposure to the stockmarket, a key driver behind Monday’s fall. But this risks re-inflating a dangerous-looking bubble; although down by 7% so far this year, the market gained more than 80% in 2010. Investors’ wild mood swings are unlikely to be tamed by the rather quaint advice issued by the bourse at the start of trading each day:

“Good morning hon’ble Investors; make your investment decision based on company fundamentals, technical analysis, price level, disclosed information; and avoid rumor based speculations.”

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