Trading in Dhaka was suspended on Thursday after the benchmark index slumped again, but it rose more than seven percent in the first 30 minutes of resumed business in Tuesday.

Hundreds of riot police were stationed outside the stock exchange building as the DGEN Index gained 479.5 points or 7.57 percent to 6,806.84.

The rapid gains follow the government's announcement of a "reform package" on Sunday that sought to restore investor confidence after days of angry street protests over market plunges.

Thousands of investors have pelted police with rocks and vandalised cars in recent weeks, demanding the resignation of the head of the central bank and the finance minister.

The DGEN index has shed 30 percent from a historic high of 8,918.51 on December 5, and in the face of mounting public anger the government has admitted "mistakes" by regulators and ordered a probe into the dive.

However, the market has soared 400 percent since the start of 2007 and rose more than 80 percent last year.

Small investors greeted Tuesday's spike with suspicion, saying it was "abnormal" and "artificially engineered".

"There are no sellers in the market, which is taking the market to abnormal heights. I think manipulators are at it again. They are just fooling us," said Fazlur Rahman Shuvo, one small investor.

Conditions for a crash have been building for some time, experts say, as the number of retail investors nearly doubled over the past 15 months to 3.3 million, lured by the record gains.