Nepal Stock Exchange (Nepse) index nosedived by 30.91 points to close at 1,522.81 points last week, with banks being reluctant to reduce the interest rate despite a surge in their loanable funds.  

The secondary market that opened at 1,553.72 points on Sunday, plunged 13.49 points to close at 1,540.23 points. On Monday, the market slid 3.51 points to close at 1,536.72 points.

Likewise, the market shed 3.19 points on Tuesday too. The index continued its downward trend, dropping 7.02 points and 3.7 points on Wednesday and Thursday respectively.

As a result, the overall market index fell 1.98 percent over the week. 

Bishnu Raj Ojha, managing director of Dipshikha Dhitopatra Karobar Company attributed the fall in Nepse index mainly to high interest rate being charged by the banks in margin lending. “Despite growing liquidity with them, banks have not revised the base rate so far,” Ojha said. 

The sensitive index that measures the performance of Group ‘A’ companies also declined 7.38 points to close at 319.64 points with a fall in index of commercial banks along with majority of other trading groups. 

With a fall in the market index, the average value of the shares listed also went down Rs35.64 billion with the market capitalisation reaching Rs1,767.85 billion from Rs1,803.49 billion over the week. 

Last week, Nepse formed a separate trading group for microfinance companies which used to be accounted under development banks. The index of microfinance group plunged 14.26 points and stood at 1,818.26 points. 

Along with microfinance, the remaining trading groups also witnessed a downfall in their indices. Insurance lost 125.5 points, the largest of all, to close at 8,392.73 points. 

Ojha said many investors rushing to book profit out of the insurance companies’ shares had led to the fall in the group’s index.  

Hotels were the second largest loser, with the group losing 68.41 points to close at 2,310.91 points. Development banks shed 57.76 points, followed by commercial banks (29.66 points), manufacturing (25.58 points), finance companies (8.42 points), ‘others’ (7.23 points), hydropower (6.12 points) and trading (1.85 points).  

Of the individual companies with the largest transaction amount, Rastriya Beema Company’s promoters’ shares led the segment, posting a turnover of Rs113.27 million. Ojha said investors were expecting the company to come up with good amount of 

dividend as the company carried out its audit that had remained pending. 

Nepal Bangladesh Bank, saw transaction of its stocks worth Rs83.32 to claim second position. Likewise, Nepal Doorsanchar Company, Nepal Life Insurance and Standard Chartered Bank were also among the top five companies with largest turnover at the secondary market. 

Likewise, promoters’ shares of Jyoti Bikas Bank topped in terms of number of transaction as 358,000 unit shares exchanged hands.

Last week, the shares of 181 listed companies were traded. Despite a fall in Nepse, the transaction amount increased 31.27 percent to Rs2.24 billion. Likewise, the traded number of shares also surged to 6,266,450 units from 4,641,090 units.  

Company Type Units

Machhapuchchhre Bank Right 7,757,697.36

Gorkhas Finance Right 2,893,313

Gurans Life Insurance Bonus 440,000

Nepal Grameen Bikas Bank General 975,000