Nepal Stock Exchange last week shed 7.2 points to close at 1,257.16 points, as investors continued to lose confidence in the central bank and their upcoming monetary policy. Investors do not believe that the central bank will be effective in introducing policies to address the problems in the country’s only secondary market.

Despite the market index contracting, the average daily turnover soared to Rs504.6 million last week from Rs382.98 million in the previous week.

The market which opened at Rs1,264.36 points on Sunday, fell 10.01 points to close at Rs1,254.35 points. On Monday and Tuesday, the market gained 5.77 points and 0.95 points respectively. However, the market again declined by 2.78 points on Wednesday and 1.13 points on Thursday, taking down the overall index by 0.57 percent during the review period.

Stock analysts said investors doubted the central bank’s ability to introduce effective policies to address the market situation through the upcoming monetary policy. “Although the central bank is pushing for the mega merger of banks, investors still do not believe that and the upcoming monetary policy are enough to solve the existing shortage of loanable fund and high interest rates,” said a stockbroker on condition of not disclosing their identity.

The sensitive index that measures the performance of Group A companies also declined 0.44 points to close at 271.17 points.

With a drop in the average price of stocks, investors lost Rs8.61 billion in the book value of their investment portfolio, as the market capitalisation declined to Rs1,564.43 billion from Rs1,573.04 billion.

Except for the sub-indices of hotels, finance companies and ‘others,’ the remaining eight trading groups posted losses.

Of them, non-life insurance was the biggest loser, shedding 188.44 points. It closed at 5,050.71 points.

Life insurance also suffered a heavy loss, dropping 107.91 points, followed by manufacturing (18.15 points), hydropower (11.53 points), development banks (5.17 points) and commercial banks (3.7 points). Microfinance and trading witnessed marginal fall of 0.65 points and 0.08 points in their indices.

Of the three gainers, hotels added 9.3 points in its index while finance companies and ‘others’ gained 3.32 points and 2.49 points respectively.

Regarding the individual companies, Himalayan Distillery saw Rs347.74 million of its shares exchanging hands, the largest during the review period. It was followed by Nepal Bank Limited, Shivam Cements, Prabhu Bank and Siddhartha Bank.

Last week, stocks worth Rs2.52 billion were traded, 32 percent more than the amount in the previous week. The total number of traded shares also increased to 7,658,917 units from 6,430,032 units.

NEPSE listed 4,014,651.58 units of right shares belonging to Nepal Insurance Company during the review period.

Right Shares/Bonus Shares

Company Type Units

Nepal Insurance Company Right 4,014,651.58