Nepal Stock Exchange index drops 58 points, week-on-week, amid a global market sell-offThe turnover on NEPSE falls too, as investors spooked by novel coronavirus, made their exit.
Nepal Stock Exchange (NEPSE) index fell a further 58 points week-on-week on Thursday, giving up almost all of its 2020 gains as a sell-off in the global markets following novel coronavirus being declared a pandemic by the World Health Organisation resulted in local investors offloading their shares to stave off potential losses.
In the week earlier, the NEPSE index had retreated 197 points. The index has now dropped 255 points in the last two weeks. On February 27, the market had closed at a high of 1,632.17.
“The market is unnerved by coronavirus fears and the government’s decision of not issuing visas to the foreigners for the time being, which is bad news for the local hotel industry,” said one broker.
All market sub-indices fell on Thursday, led by banking, hotels and hydropower stocks.
In 2018 and 2019, the market had remained bearish, but it bottomed out when the index touched at 1,100. Since the fundamentals were good at that level, the buying interest of investors got revived and a rally started at the beginning of 2020.
The NEPSE index hit an all-time high of 1,888 on July 27, 2016.
Investor sentiment strengthened after the market index breached the critical 1,300 level during the third week of the current year.
NEPSE’s total turnover on Thursday was Rs2,206,662,182. The total number of shares traded on the market, on Thursday, stood at 5,686,681. There were 23,205 transactions in all and as many as 182 company stocks got traded. The total market capitalisation at the end of last Thursday’s trading stood at Rs1,761,259.04 million.
On Thursday, Nepal Life Insurance Company Limited’s shares were the most traded in terms of value while API Finance Ltd’s shares were the most traded by volume.
The market sentiments this year have been buoyed by the biggest merger in Nepal’s banking sector between Global IME and Janata Bank.
Traders previously cited lack of liquidity as their biggest concern and the primary reason for the domestic stock market’s underperformance.