Nepal | August 13, 2020

Share market investors wait for Monetary Policy implementation

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Initially, when Nepal Rastra Bank (NRB) launched the Monetary Policy for fiscal 2020-21 the country’s sole secondary market went on a bull run as the policy announced various packages to revive the economy which has been hit by the COVID-19 pandemic.

However, in recent days the vibrancy seen earlier in the stock market has tapered down and the Nepal Stock Exchange (Nepse) went down by 0.25 per cent or 3.65 points to 1,439.06 points in the trading week between July 26 and 30.

“Earlier, when NRB brought the Monetary Policy for the ongoing fiscal year stating that it will launch different packages for investors the market witnessed tremendous buoyancy but now the market has stabilised as we are waiting to see how the central bank will implement it,” said Radha Pokharel, chairperson of Nepal Pujibazar Laganikarta Sangh.

She further said that almost all investors — big and small players — are excited about the Monetary Policy which is capital market friendly and want NRB to implement it effectively. “If it is implemented properly then the market will again witness a significant surge,” Pokharel added.

In recent days, the Nepse has gone in a correction mode, she stated, adding that earlier shortterm investors booked profit as the market was increasing.

In the review week, along with the Nepse index the sensitive index also descended by 0.98 per cent or 3.65 points to 300.96 points and float index also dropped by 0.46 per cent or 0.47 point to 100.99 points.

However, the weekly turnover increased by 5.6 per cent as compared to the previous week to Rs 8.02 billion. In the previous week, the market had witnessed transactions worth Rs 7.59 billion. Similarly, trading volume also surged to 1.92 million stocks changing hands this week from 1.91 million in the previous week.

The secondary market had opened on Sunday at 1,442.71 points and surged by 22.40 points by the end of the first trading day.

It, however, dropped by 2.62 points on Monday, 7.59 points on Tuesday and 23.36 points on Wednesday. The local bourse again increased by 7.53 points on Thursday to close the week at 1,439.06 points.

In the review week, only others, life insurance, finance and mutual funds subgroups witnessed some gains. The others sub-index rose by 2.71 per cent or 21.35 points to land at 810.54 points.

Likewise, life insurance subgroup climbed up by 0.75 per cent or 64.19 points to 8,616.64 points.

Moreover, finance also edged up by 0.30 per cent or 2.04 points to 671.86 points and mutual funds inched up by 0.19 per cent or 0.02 point to 10.61 points.

Meanwhile, hotels subgroup was the biggest loser of the week, dropping by 5.08 per cent or 83.81 points to 1,589.55 points.

Likewise, trading went down by 2.68 per cent or 23.43 points to 850.53 points and manufacturing sub-index descended by 1.77 per cent or 50.10 points to 2,783.03 points.

Development banks dropped by 1.31 per cent or 24 points to 1,807.03 points. Non-life insurance fell by 0.87 per cent or 57.79 points to 6,576.60 points and banking subgroup descended by 0.65 per cent or 8.21 points to 1,238.53 points. Similarly, microfinance subgroup slipped by 0.43 per cent or 10.55 points to 2,448.01 points and hydropower inched down by 0.33 per cent or 3.24 points to 968.91 points.

In the review week, Nepal Reinsurance Company was the leader in terms of weekly turnover with Rs 838.15 million. It was followed by Nepal Life Insurance Co with Rs 729.46 million, NIC Asia Bank with Rs 342.32 million, NMB Bank with Rs 292.02 million and NIC ASIA Laghubitta Bittiya Sanstha with Rs 269.74 million.

In terms of weekly trading volume also Nepal Reinsurance Co was the forerunner with 1,476,000 of its shares changing hands. It was followed by NMB Bank with 670,000, NIC Asia Bank with 588,000, NCC Bank with 541,000 and Nepal Life Insurance Co with 529,000 shares being traded.

Meanwhile, NIC Asia Laghubitta Bittiya Sanstha topped in terms of number of transactions with 22,268 transactions. Nepal Reinsurance Co with 20,309, Nepal Life Insurance Co with 4,066, NMB Bank with 2,822 and NIC Asia Bank with 2,249 transactions rounded up the top five.

Source: Nepse

A version of this article appears in e-paper on August 2, 2020, of The Himalayan Times.

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