KATHMANDU, MAY 27

The Nepal Stock Exchange (Nepse) index rose by 81.80 points or 4.36 per cent in the trading week between May 21 and 24 to resurface above the 1,900-point threshold.

The growth in capital market seen in the review week can be attributed to the indication of interest rates decreasing in the coming days, easing liquidity situation, increasing inflow of remittances and foreign exchange reserves, surplus situation of balance of payments, and satisfactory policies and programmes introduced by the government last weeks, as per stakeholders.

According to share market analyst Chhote Lal Rauniyar, while interest rates have decreased to some extent, the stakeholders will only experience some relief after interest rates drop further to single digit in the coming months. While the policies and programmes introduced by the government are not against the market's growth, it is also neither very positive, he opined.

'With the decrease in traders, many were able to accumulate a lot of shares, which resulted in the average daily turnover increasing by almost two billion rupees after a long time,' he shared. He also complained of the interventions made by the Nepal Rastra Bank (NRB) by introducing stringent policies in the current fiscal year as well as the statements made by lawmakers in the Parliament against the introduction of additional brokers' licences among other steps taken by the Securities Board of Nepal (SEBON).

'The market had been hovering around the 1,800-point threshold for quite some time now, despite various adverse effects in the country's economy and policies. Stakeholders are hopeful that the market will rebound strongly with the introduction of favourable market policies in the upcoming budget,' he added.

The sensitive index, which measures performance of class 'A' stocks, increased 3.67 per cent to 371.31 points in the review period.

Meanwhile, the float index that gauges performances of shares actually traded advanced by 3.93 per cent or 5.16 points to settle at 136.57 in the review week.

Altogether 19.25 million shares were traded during the review week through 133,714 transactions that amounted to over Rs 6.95 billion. The weekly turnover rose by over 51.2 per cent compared to the previous week when 14.19 million shares had changed hands through 119,989 transactions that totalled Rs 4.59 billion. The average daily turnover in the past week was over Rs 919.6 million and it increased to Rs 1.73 billion this week. It may be noted that the market was open for just four trading days in the review week compared to five trading days in the previous week.

The benchmark index had opened at 1,877.32 points on Sunday and it rose by 5.88 points by the time of closing to 1,883.20 points. The market gained 8.11 points on Monday to close at 1,891.31 points before jumping by 51.32 points on Tuesday to resurface above the 1,900-point threshold to close at 1,942.63 points. On Wednesday, the benchmark index added 16.49 points to close at 1,959.12 points for the trading week. The market remained closed on Thursday on the occasion of 'Bhoto Jatra.' All the subgroups landed in the green this week.

Hotels and Tourism led the pack of gainers, advancing by 12.71 per cent to 4,009.86 points, followed by manufacturing and processing, up by 10.99 per cent to 4,921.93 points; non-life insurance rose 9.08 per cent to 9,558.46 points; microfinance increased by 7.48 per cent to 3,612.67 points; trading gained 6.94 per cent to 2,230.91 points; life insurance by 6.44 per cent to 10,102.78 points; others by 4.32 per cent to 1,401.80 points; investment by 3.96 per cent to 67.18 points; finance by 3.47 per cent to 1,640.84 points; hydropower by 2.75 per cent to 2,428.58 points; development banks by 2.45 per cent to 3,593.02 points; banking by 1.95 per cent to 1,246.26 points; and mutual funds by 1.10 per cent to 13.77 points.

A version of this article appears in the print on May 28, 2023, of The Himalayan Times.