Trading halt ordered twice as stocks soarThe secondary market on Monday saw the circuit breaker being applied twice one hour after opening as feverish trading in shares of insurance companies sent the Nepal Stock Exchange (Nepse) index soaring.
The secondary market on Monday saw the circuit breaker being applied twice one hour after opening as feverish trading in shares of insurance companies sent the Nepal Stock Exchange (Nepse) index soaring.
The first trading halt was ordered at 11:27am after the market rose 3 percent. A second trading halt was ordered at 11:59am when the index climbed 4 percent.
The stock market has been witnessing a bull trend for the past three weeks. On Sunday too, the Nepse jumped as insurance stocks took off on expectations of bonus and right shares.
Insurance companies have been ordered to boost their paid-up capital fourfold, fueling speculation of a rise in share prices.
The upbeat mood in the secondary market on Monday, however, did not last long. Following the second trading halt, the index started falling, losing 6.59 points to close at 1,660.52 points.
Stockbroker Anjan Raj Poudel said the abnormal rise in the Nepse appeared due to buying pressure on shares of insurance companies in the initial trading hours. “However, a number of investors rushed to book their profits mainly on commercial banks shares which subsequently led to a selling pressure,” he said. “As a result, the index dropped
Two among the nine trading groups posted gains. Shares of insurance companies soared 67.65 points while trading groups gained 1.41 points.
Hotels observed the largest fall of 35.39 points followed by hydropower (-29.52 points) and Dev banks (-14.08 points). The index of commercial banks also plunged 7.28 points.
Despite the fall in the Nepse index, the transaction volume increased notably. Turnover reached a high of Rs2.53 billion.
Nepal Bank Limited witnessed the largest turnover of Rs135.46 million. Among the top 10 companies in the category, five were insurance companies.
Rastriya Beema Co was the top gainer. The Co’s share price gained Rs1,479 to close at Rs16,274 apiece. The Co’s shares have risen in price by Rs2,824 apiece in the first two days of trading this week.