Nepal Stock Exchange (Nepse) index surged 33.92 points to close at 1,424.95 points last week, as investors were buoyed by the formation of new government led by Prime Minister KP Sharma Oli.
The market that opened at 1,391.03 points on Sunday fell 6.32 points to close at 1,384.71 points. On Monday, the market shed 4.42 points to close at 1,380.29 points. The stock market was closed on Tuesday to mark Mahashivaratri, the festival of Hindus.
After the conclusion of the festival, the index rebounded by gaining 8.65 points and 36.01 points on Wednesday and Thursday respectively. As a result, the Nepse index inclined 2.43 percent over the week.
The stock market’s performance over the review period last week was a bright spot, breaking the losing streak spanning a few weeks in the secondary market. The possibility of a new government being formed boosted investor sentiment and the market index reflected that, picking up points in the second half of last week’s trading. As a result, the average daily transaction also jumped to Rs385 million from Rs240 million during the review period.
“The stock market picked up after Former Prime Minister Sher Bahadur Deuba stepped up to resign from the position paving way for the formation of the new government,” said a stockbroker, under condition of anonymity.
The sensitive index that measures the performance of Group ‘A’ companies also increased 7.3 points to close at 301.3 points with all ten trading groups posting gains in their indices.
With a rise in the market index, the average value of the shares listed in stock market also went up Rs39.65 billion, with market capitalisation reaching to Rs1,666.39 billion from Rs1,626.74 billion over the week. All ten trading groups witnessed an uptick in their indices. Insurance gained the largest of 222.18 points to close at 7,288.64 points. Microfinance’s index surged 64.02 points, followed by development bank of 56.52 points, hydropower of 43.05 points and commercial banks of 30.33 points.
Likewise, the market sub-index of manufacturing rose by 25.18 points, hotels by 20.6 points, trading by 10.97 points, finance companies by 9.98 points and ‘others’ by 1.83 points.
Of the individual companies, Prabhu Bank Limited led in terms of both the transaction amount and the number of traded shares. The company witnessed a total transaction of Rs67.15 million from turnover of its 293,000 shares.
According to stockbrokers, investors were attracted to shares of Prabhu Bank Limited as the bank had showcased good financial health in the first half of the current fiscal year.
“The bank earned net profit of Rs635 million following the recovery of non-performing and substandard loans. In addition, the low price of the bank’s shares compared to other commercial banks also encouraged investors to purchase the bank’s stocks.”
Likewise, promoters’ shares of Nepal Life Insurance worth Rs60.5 million was transacted to finish in second position, followed by the general shares of the insurer, Nepal Investment Bank Limited and Kumari Bank in terms of the transaction volume.
Last week, the stocks of 179 listed companies were traded. Despite rise in market index, the transaction amount fell marginally by 0.62 percent to Rs1.54 billion. According to Nepse, the traded number of shares slipped to 3,792,470 units from 4,196,490 units.
Right Shares/Bonus Shares
|Company ||Type ||Units|
|Support Microfinance Bittiya Sanstha ||General ||600,000|
|Jebil’s Finance ||Right ||2,889,562.50|
|Guheshwori Merchant Banking & Finance ||Right ||1,973,928.77|
|Oriental Hotel ||Bonus ||1,425,106.35|