The Nepal Stock Exchange index last week fell 25.49 points compared to the previous week to close at Rs1,129.81 points as investors sold shares ahead of Dashain to manage incremental expenses ahead of the festive month.
Given the prevailing bearish sentiments on the market, its average daily turnover also fell last week to Rs200.39 million from Rs378.55 million the previous week.
The market index had opened at Rs1,155.30 points on Sunday, but fell 16.04 points to close for the day at Rs1,139.26 points. On Monday, the market index ended with a marginal gain of 1.73 points. On the remaining trading days of the week, the market went down again. During the week, the stock valuations fell 0.22 percent, overall.
Stockbrokers said the market’s behaviour is in line with sentiments that usually prevails each year ahead of the start of the festive season.
“Apart from this, certain investors rushed to book profits in shares that had risen in the week earlier. This adversely impacted market sentiments last week,” said Bharat Ranabhat, president of Stockbrokers’ Association of Nepal.
In the previous week, the market’s index had risen 50 points cumulatively over two trading days after Finance Minister Yuba Raj Khatiwada had urged fundraisers such as Employee Provident Fund and Citizen Investment Trust to invest on the stock exchange.
“In recent weeks, the market has been on a downward spiral despite a number of listed companies announcing a good amount of dividend,” said a stockbroker on the condition of anonymity.
Last week, the sensitive index that measures the performance of blue chips companies went down 4.89 points week-on-week to close at 247.32 points. The sensitive index was impacted by a decline in the indices of a majority of the trading groups along with that of the commercial banks that hold a major share in overall market capitalisation.
Last week, the investors lost Rs32.14 billion in the book value of their investment portfolio, after market capitalisation declined to Rs1,435.31 billion from Rs1,467.45 billion.
During the review period, out of 11 trading groups, nine witnessed a downswing in their indices. Non-life insurance and life insurance companies were the biggest losers. While non-life insurance companies’ index lost 184.52 points, the index of life insurance went down 125.96 points.
Manufacturing, hotels, hydropower, microfinance, development banks, commercial banks and finance companies were among other losers, all of which observed a fall in double digits. Last week, stocks worth Rs1 billion were traded which was almost half the trading volume the previous week. The number of traded shares also went down to 4,041,920 units from 6,587,020 units.
Nepal Stock Exchange listed 129,742,099 units of primary shares during the review period.
Rajesh Khanal is a business reporter for The Kathmandu Post covering insurance, the capital market, trade and macroeconomic issues. Khanal has also taught economics at a number of colleges in Kathmandu.
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