Nepal Stock Exchange (Nepse) index plunged 26.77 points to close at 1,288.36 points, as investors took a wait and watch stance triggered by uncertainty of the new government’s policy, tussles between the Nepal Bankers’ Association and NIC Asia Bank coupled with a shortage of loanable funds with the banks.
This is the fourth successive week that a freefall has been observed at the secondary market. Over the last four weeks, the secondary market has lost 137 points.
Over the week, Nepse once again fell below the 1,300 points marker and hit 1,277.01 points, the lowest point in a year.
Similarly, single day trading also plunged to as low as Rs184.59 million on Wednesday, the lowest in the last two years.
The market that opened at 1,315.13 points on Sunday shed 31.04 points to close at 1,284.09 points. On Monday, the market was down 7.08 points and closed at 1,277.01 points.
Stockbrokers attributed the freefall to the dilemma among the investors to invest at the stock exchange.
“Due to multiple factors such as the uncertainty in policy of the left alliance government and liquidity crunch with the banks, buyers were unwilling to purchase the stocks. Likewise, the sellers were also reluctant to sell the stocks that had posted a heavy decline in their prices following the freefall over the last few weeks,” said a stockbroker under condition of anonymity.
On Tuesday, Wednesday and Thursday, the market however gained 4.89 points, 4.06 points and 2.4 points respectively.
As per the source, the market headed towards a correction on these days with the consensus seen among the bankers and the government assurance to a group of investors’ delegates to revise the threshold on the loan against shares.
On an average, the Nepse index declined 2.03 percent over the week.
The sensitive index that measures the performance of Group ‘A’ companies also decreased 5.08 points to close at 274.38 points with a fall in indices of most of the trading groups.
With a fall in the market index, the average value of shares listed on the stock market also went down Rs31.15 billion, with the market capitalisation reaching to Rs1,508.38 billion from Rs1,539.53 billion over the week.
Of the ten trading groups, eight witnessed downturn in their indices. Insurance lost
the largest of 221.58 points to close at 6,246.76 points. Manufacturing’s index dipped 96.6 points, followed by microfinance of 58.05 points, hydropower of 45.43 points, commercial bank of 20.62 points, development banks of 18.69 points, finance companies of 9.58 points and ‘others’ of 2.12 points.
The sub-index of hotels, however, inclined 12.04 points while the sub-index of trading remained stable at 208.43 points throughout the weekdays.
Of the individual companies, Nepal Life Insurance Company led in terms of the transaction amount. The company witnessed a total transaction of Rs82.06 million. The insurer recently announced plans to provide 70.53 percent dividend to its shareholders.
Likewise, Nabil Bank with holding shares transaction worth Rs57.41 million was in second position, followed by Everest Bank, Nepal Investment Bank and NIC Asia Bank.
Janata Bank led in terms of the traded number of shares. A total of 167,000 units of the bank’s shares were traded over the review period.
Last week, the stocks of 174 listed companies were traded. With fall in the market index, the transaction amount also plunged 27.92 percent to Rs1.29 billion. According to Nepse, the traded number of shares also declined to 3,339,160 units from 4,793,120 units.
Right Shares/Bonus Shares
Company Type Units
Chilime Jalabidhyut Bonus 5,171,886.72
Kailash Bikas Bank Bonus 2,291,488
Excel Development Bank Bonus 1,158,302.25
Guheshwori Merchant Banking & Finance Bonus 1,091,249.31
Prudential Insurance Company Bonus 855,360
Laxmi Laghubitta Bittiya Sanstha Bonus 220,000
Swarojgar Laghubitta Bittiya Sanstha Bonus 174,996.80
Barun Hydropower Company Bonus 121,500
Global IME Laghubitta Bittiya Sanstha Bonus 113,000
Mount Makalu Development Bank Right 345,800Published: 2018-03-18 09:10:10