Stock market sheds over two per cent



The Nepal Stock Exchange (Nepse) index dropped by 2.33 per cent or 37.78 points to 1617.81 points in the trading week of August 27 to 31. Most of the sub-indices landed in the red in the review period thus bringing the benchmark index down.

Similarly, the float index and sensitive index also fell in the review period. The sensitive index came down to 331.32 points, declining by 8.62 points or 2.53 per cent and the float index declined to 114.52 points, down by 2.95 points or 2.51 per cent.

The market opened on 1617.81 points on Sunday and by the end of the trading day it had risen to 1622.32 points. However, the market started to decline from Monday when the Nepse index closed at 1612.91 points, a decline of around 10 points. The stock market remained closed on Tuesday due to a public holiday for Gaura Parwa. The drop continued on Wednesday and Thursday too.

Stock market analyst and broker Ambika Prasad Paudel said that the secondary market is taking its natural course. “The stock market has its own way of functioning. Sometimes we think that the market is being distorted by some individuals but the stock market movement last week was a natural one,” he said.

However, he is convinced that investors are suffering from the high interest rates being charged by financial institutions, which he says is being reflected in the market. “The problem of high interest rates being faced by investors has created pressure on the market.”

In the review week, sub-indices of the financial sector — banking, insurance, development banks and finance — substantially declined. The sub-index of class ‘A’ financial institutions dropped to 1362.35 points, down by 39.25 points or 2.8 per cent. The share price of Nabil Bank fell by 1.7 per cent to Rs 1,700, and that of Everest Bank descended by 1.96 per cent to Rs 1,299.

The sub-index of the insurance sector suffered the highest decline of 3.62 per cent in the week. It
decreased by 332.93 points to rest at 8854.74 points. Likewise, the finance sector sub-index dropped to 790.57 points, a decline of 26.03 points or 3.19 per cent. Meanwhile, the sub-index of development banks also fell by 0.47 per cent or 9.45 points to 2006.89 points.

Similar to the financial sector shares, hydropower sector also witnessed a drop of 1.85 per cent or 34.36 points to 1825.59 points. The hotel sector too declined by 1.88 per cent or 45.65 points to 2380.43 points in the review period. The others sector also descended by 1.12 per cent to 715.81 points.

Only the manufacturing sector went up in the week by 2.74 per cent or 71.09 points to 2665 points. The trading sector remained unchanged in the week on 214.11 points.

In the week, a total of 7.58 million shares of 180 companies, which amounted to Rs 3.56 billion, changed hands in 39,091 transactions. The traded amount was 7.4 per cent higher than that of the previous week when it stood at Rs 3.15 billion.

Chhimek Laghubitta Bikash Bank topped the list in terms of turnover with Rs 184.27 million. NIC Asia Bank was in the second position with Rs 147.66 million, followed by Nepal Life Insurance Company at Rs 141.81 million, Nabil Bank at
Rs 135.41 million and Prime Life Insurance Company rounded up the top five with Rs 105.94 million.

Likewise, NIC Asia Bank topped the list in terms of total shares traded with 326,000 of its scrips changing hands and Himalayan Water Partner had the highest number of transactions — 7878.

 September 03, 201