Kathmandu, April 2:
The bull trend in Nepal Stock Exchange (Nepse), the countryâ€™s sole secondary capital market, continued for the second day with a sound growth of over Rs 1.41 billion in market capitalisation.
The Nepse index, a barometer to gauge the capital market trend, posted a growth of 5.31 points and closed at 507.46 points from an opening of 502.15 points this morning.
The capital market suddenly bounced back on Sunday with a record intra-day trading of Rs 5.64 billion gain in total market capitalisation. The index also registered a huge growth of 21.16 points, which is the highest so far for intra-day trading at Nepse.
â€œThe investorsâ€™ confidence towards the security market has certainly gone up with positive developments in the political arena. The Nepal Rastra Bankâ€™s recent directives for financial institution to double paid-up capital requirement has also helped boost confidence,â€ said Shambhu Panta, assistant manager at Nepse.
The central bank last week had decided to double the paid up capital requirement for the financial institutions by 2012-13 in the wake of opening up of Nepali financial sector to all by 2010 as per the WTO agreement. â€œMany companies are likely to issue bonus shares in order to meet the capital requirement, which propelled the growth in the market,â€ said Panta.
Total market capitalisation rose to Rs 135.49 billion from Rs 134.07 billion. Among gainers, Nepal Investment Bankâ€™s share price soared by Rs 102 per share, while Himalayan Bank Ltd gained Rs 35 and Nepal SBI Bank closed up with a Rs 26 gain.
Most of the commercial banks had seen their share prices go up on Sunday. As a result, Nepal Stock Exchange Ltd had imposed a circuit breaker and halted the share trading of three commercial banks in order to correct relentless growth of over 10 per cent in a day. Nepse today took a similar measure in Nepal Investment Bankâ€™s trading, too.
The banking group, which accounts for over 60 per cent of total market volume, also saw a significant rise in its index. The groupâ€™s sub-index rose by 9.69 points to close at 541.89 points.
Of the top three gainers on Sunday, Standard Chartered Bank had earned Rs 270 per share, while Nabil Bank gained Rs 210, and Everest Bank Ltd earned Rs 101.
Rabindra Pradhan, a leading stock broker, terms the current growth an â€˜inevitable dividendâ€™ of prospects of political stability, with the Maoists formally joining the government. â€œBesides political stability, the central bankâ€™s decision on last Thursday also helped boost the investorsâ€™ confidence,â€ he told this daily.