Kathmandu, August 19

The country’s only secondary market that has been on a bull run since the central bank introduced the monetary policy set a new record today, as the Nepal Stock Exchange (Nepse) index closed at an all-time high of 1,191.92 points.

The benchmark index was northbound since the market opened at yesterday’s close of 1,159.93 points. By the day’s closing, the local bourse had gained 31.99 points or 2.76 per cent.

“Stock investors have been majorly attracted to banking shares as the new monetary policy requires banks and financial institutions to increase their paid-up capital within a limited time frame,” explained Prakash Rajaure, a stock market analyst, adding their sentiment has received further boost with the Central Depository System Ltd (CDSC) implementing compulsory demat transactions.

Stating that investors have become more mature over the years, he opined the local bourse will likely stabilise in the coming days. Still, if the constitution is promulgated in the near future, the bull run will likely persist for a while.

“Promulgation of the new constitution will definitely aid in taking Nepse higher, but that is a secondary factor,” said Rajaure.

However, some stock analysts are watching the market movement with cautious optimism. Rabindra Bhattarai, another stock analyst, had recently warned that the surge in the country’s stock exchange is not backed by strong fundamentals and the market risks have also gone up significantly.

Today’s movement of the Nepse index was comparatively smooth, as the market operator did not have to apply any circuit breaker during the day. Altogether, 1.22 million units of shares of 139 companies amounting to Rs 667.71 million were traded through 4,497 transactions.

The sensitive index, which gauges the performance of class ‘A’ stocks, jumped 7.17 points or 2.84 per cent to 259.95 points. Similarly, the float index that measures the performance of shares actually traded also increased by 2.43 points or 2.94 per cent to 85.08 points.

Trading was the only subgroup to remain constant at 206.51 points. All the remaining subgroups recorded gains, with hotels leading the pack by surging 166.47 points to 2,086.49 points. Insurance too ascended by a massive 99.48 points to 4,737.38 points.

Others, banking and manufacturing also went up by double digits — adding 42.28 points to 823.54 points, 33.34 points to 1,159.29 points and 25.94 points to 1,893.16 points, respectively.

Similarly, development banks, finance and hydropower sub-indices rested at 871.90 points (up 8.47 points), 548.42 points (up 7.17 points) and 2,140.29 points (up 5.72 points).

Himalayan General Insurance and Oriental Hotels were the top gainers during the day, with their stock prices rising by 10 per cent. United Insurance, NLG Insurance and Prabhu Insurance rounded up the top five in this category.

Conversely, Mount Makalu Development Bank, Mahakali Bikas Bank, Nepal Express Finance Ltd, Triveni Bikas Bank and Sewa Bikas Bank were the top losers today.