Regulator indecision on several government policies sinks NEPSEInvestors lost a whopping Rs15.82 billion in the book value of their investment portfolio.
Nepal Stock Exchange plunged 14.52 points to close at 1,224.04 points last week as the regulator continues to dilly-dally on resolving issues affecting the country’s only stock exchange.
Along with a fall in the market index, the average daily turnover also slid to Rs357.55 million last week from Rs438.28 million in the previous week.
The market which opened at Rs1,238.56 points on Sunday fell 4.84 points to close at Rs1,233.72 points. On Monday, the secondary market inched up marginally by 0.13 points. However, the market nosedived in the remaining trading sessions, losing 9.81 points in total.
As a result, the market index was down by 1.17 percent during the review period.
For the past few weeks, the secondary market has been reeling in the row of confusion over the complexity in calculating the amount of capital gains enforced by the tax authority. So far, both the Ministry of Finance and the Securities Board of Nepal have not come up with a decision to fix the threshold of capital gain assessment.
Stocks analysts said investors were losing confidence in the market and rushed to sell their stocks. “Apart from the capital gain issue, the market was also adversely affected by several factors such as controversies over the interest spread calculation and deferral date for brokering licence to commercial banks,” said a stockbroker under the condition of anonymity.
The sensitive index that measures the performance of Group A companies also declined 3.32 points to close at 264.69 points.
Last week, investors lost a whopping Rs15.82 billion in the book value of their investment portfolio, after the market capitalisation declined to Rs1,551.60 billion from Rs1,567.42 billion.
Of the 11 trading groups, seven dwindled during the review period. Non-life Insurance posted the biggest loss, dropping 64.06 points to close at 4,894.04 points. Likewise, life insurance, hydropower, commercial banks and ‘others’ also shed double-digits points. Indices of microfinance and development banks were down by 6.85 points and 2.34 points respectively.
Of the four gainers, hotels and trading added 16.21 points and 12.41 points respectively. Similarly, finance companies and manufacturing also gained 2.52 points and 0.26 points respectively.
Regarding individual companies, Machhapuchchhre Bank recorded the largest transaction worth Rs193.13 million.
Rasuwagadhi Hydropower, Laxmi Bank, Nepal Bank Limited and Sanjen Jalavidhyut Company were also among the top five companies with the largest amount of shares transactions.
Last week, stocks worth Rs1.78 billion were traded which was 18.7 percent less than the amount in the previous week. The total number of traded shares, however, increased to 7,538,130 units from 7,438,850 units.
During the review period, Nepal Stock Exchange listed 4,156,699 units of primary shares of Surya Life Insurance and Nepal Investment Bank.