Nepse gains 128.7 points

- Post Report, Kathmandu

Mar 26, 2017-

Nepal Stock Exchange (Nepse) surged 128.7 points to close the week at 1,486.04 points, as money released by companies that had launched initial and further public offerings was pumped back into the stock market. This pushed up daily average turnover to over Rs1 billion during the week. 

The secondary market opened at 1,357.34 points on Sunday and added 24.85 points to its index to close at 1,382.19 points. On Monday, the market gained another 42.19 points to close at 1,424.38 points. 

Likewise, the stock market gained 37.85 points and 18.85 points on Tuesday and Wednesday, respectively. The growth rate was sluggish on Thursday, as it inched up 4.96 points. As a result, the overall index went up by 9.48 percent over the week.   

“The secondary market witnessed a huge spike in demand as investors who had applied for shares floated in the primary market received their money back from companies that had launched initial and further public offerings. This money was reinvested back into the stock market,” said Anjan Raj Poudel, managing director of Thrive Brokerage House. 

According to him, the surge in prices of insurance stocks helped both the Nepse index and transaction volume to go up. 

Along with the Nepse index, the sensitive index that measures the performance of Group ‘A’ companies also gained 28.43 points to close at 323.26 points. The sensitive index rose due to significant gains made by sectors such as commercial bank. The surge in investment meant that value of the shares listed on the stock market soared by Rs147.03 billion, with market capitalisation hitting Rs1,686.36 billion on Thursday, the week’s last trading day, from Rs1,539.33 billion a week ago. 

Of the nine sub-indices, the insurance sub-index witnessed the biggest gain of 963.69 points to end the week at 7,226.9 points. Poudel said there was sudden rise in demand for insurance shares due to rumours that the regulator would increase the minimum paid-up capital for insurance companies to Rs2 billion.  

Hydropower sub-index finished second last week, gaining 191.47 points to close at 1,835.36 points. The sub-indices of development bank, hotel, and commercial bank gained 182.19 points, 164.66 points and 112.13 points, respectively. The sub-indices of finance, others and manufacturing also gained 48.86 points, 12.43 points and 0.45 points, respectively.

The trading sub-index was stable at 206.16 points throughout the week. Last week, shares of 155 listed companies were traded on Nepse. Along with rise in the Nepse index, the transaction amount soared 222.13 percent to Rs5.77 billion. The traded shares also showed astronomical growth, rising from 3.8 million units to10.8 million units. Regarding individual companies, National Life Insurance topped in terms of transaction amount,  posting turnover of Rs325.56 million over the week. 

“Investors, who could not grab shares of the insurer during the further public offering, have started investing in the company, lured by good returns,” said Poudel.

Nepal Credit and Commerce Bank secured the second position in terms of transaction volume, with a turnover of Rs252.72 million. Nepal Bangladesh Bank, Prabhu Bank and Sanima Bank rounded out the top five companies in terms of highest transaction amount. 

Published: 26-03-2017 10:24

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