Benchmark index at three-month low

KATHMANDU:

Weighed down by a panic situation created in the beginning of the week, the Nepal Stock Exchange (Nepse) index dropped 10.82 points or 1.1 per cent to rest at 967.62 points, from March 15 to 19.

News of fake share certificates being traded in the share market in the previous week along with the central bank’s directive on March 13, which added a new category to credits being extended and requiring commercial banks to set aside five per cent of loan amount as risk provisioning, had created a bit of a panic situation. Consequently, starting the week at 978.44 points on Sunday, the benchmark index shed 7.76 points by the day’s closing. On Monday, Nepse continued on the southbound course, diving 11.54 points to a three-month low of 959.14 points.

Reports of Nepse conducting an investigation on fake shares helped the local bourse somewhat stabilise and add 4.32 points and 0.78 points on Tuesday and Wednesday, respectively. On Thursday, announcement of Chiranjeevi Nepal

as the new governor of Nepal Rastra Bank helped Nepse index rise by 3.38 points. However, the gains of the last three trading days of the week were insufficient to make up for the losses incurred in the first two days of the trading week. Nepse was this low on January 26, when the index had closed at 968.63 points.

Nonetheless, market experts believe Nepse will rise steadily in the coming days, especially as the new governor is credited with introducing positive reforms in the country’s only secondary market when he was at the helm of Securities Board of Nepal, the securities market regulator.

Altogether 2.17 million units of shares worth Rs 852.37 million were traded at Nepse through 7,110 transactions during the trading week. In comparison, transactions of 2.81 million shares worth Rs 1.05 billion had been undertaken through 7,577 dealings in the previous week.

The sensitive index, which gauges the performance of class ‘A’ stocks, dipped 2.33 points to 205.75 points. The float index that measures the performance of shares actually traded also declined by a marginal 0.61 point to 68.17 points, in the week.

Whereas trading subgroup remained constant at 196.93 points, manufacturing and hotels were the only subgroups to witness some gains.

Investors continued to offload insurance stocks, which resulted in the sub-index dropping 58.15 points to 4,154 points. Even as the share price of Nepal Life Insurance rose by nine rupees to Rs 4,650, that of National Life Insurance declined by Rs 55 to Rs 2,315 and Prime Life was down Rs 18 to close at Rs 1,136, among others.

Contrary to the previous week’s gain

of 4.24 points, development banks descended by 13.96 points to 815.93 points. Scrips of Chhimek Laghubitta Bikas Bank closed at Rs 1,650, down Rs 36, while of Swabalamban Bikas Bank declined by Rs 20 to Rs 1,635.

After leading the gaining team in the preceding week, others subgroup slumped by 12.92 points to 742.5 points, dragged down by Nepal Telecom’s share value dipping by Rs 11 to Rs 632.

Banking sub-index went down by 9.74 points to 842.87 points. Standard Chartered’s shares lost Rs 65 to close of Rs 1,960, and Everest Bank’s too were down Rs 30 to Rs 2,110. Hydropower retreated by 4.09 points to 2,231.08 points, and finance by 2.54 points to 539.19 points.

Meanwhile, manufacturing rose by 9.47 points to 1,455.78 points, on the back of Himalayan Distillery’s scrips gaining Rs 41 to end at Rs 696. Hotels inched up by 2.89 points to 2,024.69 points.

Source: THT