Nepal Stock Exchange (Nepse) last week dropped 21.85 points, but the turnover jumped 13.16 percent to Rs3.88 billion. The number of traded shares too rose to 6,806,661 units from 6,576,870 units.

The surge in the turnover despite the fall in the Nepse index suggests increased investor confidence, according to analysts.

The market that opened at 1,377.33 points on Sunday shed points throughout the week to close at 1,355.48 points on Thursday. 

The fall has been attributed to the Securities Board of Nepal’s (Sebon) warning on Monday against speculative investment at a time when listed companies are not performing very well.

“The board makes a special request to investors to study the current economic picture, fundamental indicators of listed companies and their ability to absorb risks before making an investment,” the Sebon said in a statement.

Stockbrokers termed the fall in the benchmark index “market correction”. Priya Raj Regmi, president of Stockbrokers’ Association of Nepal, said it was normal for a market, which had been rising for a long time, to witness nominal loss. “As the market is supported by healthy transaction volume, the index is likely to grow further,” he said. 

Four of the nine trading groups posted gains. The group representing insurance companies (up 25.69 points) led the gainers’ side including manufacturing, development banks and finance companies.

Hydropower, commercial banks, others and hotels groups were the losers. The hydropower group lost the most 264.17 points. The trading group was stable at 201.38 points.

The sensitive index that measures the performance of A class companies also lost 5.08 points to close at 292.22 points. 

Nepal Life Insurance posted the highest individual turnover of Rs347.47 million. It was followed by Nepal Bank, Citizens Bank International, Everest Bank and Sanima. With 666,000 units of its shares changing hands, Nepal Bank topped in terms of the number of shares traded.