Dashain Effect on NEPSE: What Does 10 Years of Data Tell Us?

Dashain is not only Nepal’s biggest festival but also a period when economic activity and investor participation often slow down. With many investors travelling outside Kathmandu and businesses operating on reduced schedules, trading activity around the festival can become quieter, But does Dashain consistently push the Nepal Stock Exchange (NEPSE) upward or downward?

This year Market will close by Ashwin 30, 2083 (Friday) and will open after 9 days holidays in 9 Kartik, 2083 (Monday) to resume regular trading. 

A look at the past 10 years shows that there is no fixed “Dashain effect” on the stock market. NEPSE has moved both ways around the festival period, with the direction often depending more on the broader market environment and market trend than the festival itself.

For this analysis, the NEPSE movement is observed from roughly 10 days before Dashain to around one week after the market resumes following the festival. 

^{Note: In the table "NEPSE Before Dashain" Data shows 10 days before Dashain and "NEPSE After Dashain" data shows a post week after Dashain around 10 days.} 

Seven Years Up, Three Years Down

The 10 year data presents a mixed but slightly positive picture. NEPSE recorded an upward movement in seven of the 10 periods, while three years ended lower after Dashain.

The strongest positive movement came in 2081, when the index rose from around 2,466 before Dashain to 2,745 after the festival, a gain of more than 11%. The 2077 period also recorded a notable rise of nearly 6%, while 2073 gained around 3.6%.

On the other hand, 2080 saw the largest decline in the period, with NEPSE falling around 2.6% from 1,896 to 1,846. The market also declined in 2074 and 2078, although the fall was relatively limited.

This suggests that Dashain itself has not historically been a reliable reason for NEPSE to rise or fall. Rather, the market's existing trend, investor confidence, liquidity and economic conditions appear to have a greater influence on the direction.

What Happened Last Year?

In 2082, NEPSE stood at around 2,487 (Ashwin 5 open point) before Dashain and closed at around 2,503 (Ashwin 26) in the post Dashain period, Dashain was in Ashwin 16. The index thereafter went to the 2965 level and fell down till today at around 2560 Point.

This relatively small movement is important because it shows that a Dashain period does not necessarily bring a major change in the overall index. Investors may remain cautious, resulting in lower trading activity without creating a strong directional move.

Where Does NEPSE Stand This Year?

This year market enters Dashain 2083 from a considerably different position.

NEPSE recently closed at 2,566.76 points on October 5, 2026, after falling 20.48 points during the session. The index had closed the previous week at 2,629.81, meaning it has recently come under selling pressure. Average daily turnover has also weakened, while the market has remained below the 2,600 level.

The index's 52 week high currently stands at 2,960.40, while the 52 week low is 2,487.17. At 2,587.25, NEPSE is therefore much closer to its 52-week low than its high.

The timing is also important. Dashain 2083 falls on Kartik 4, or October 21, 2026, with Ghatasthapana beginning on Ashwin 25.

So, What Could Happen This Dashain?

Historical data does not provide a clear signal that NEPSE will automatically rise or fall during Dashain. Seven of the past 10 periods were positive, but the size of those gains varied significantly. The three declining periods also show that the festival can come during a weak market and fail to change the broader direction.

This year's starting point deserves more attention. NEPSE is entering Dashain after a period of weakness and is trading only modestly above its 52-week low. A lack of aggressive buying before the festival could keep the market under pressure, particularly as investor participation may remain subdued during the holiday period.

At the same time, the market being closer to its 52 week low could also create room for bargain buying if investor confidence improves. Therefore, a stable or gradual recovery after Dashain cannot be ruled out.

The key takeaway is that Dashain may influence trading activity, but history does not support the idea that it determines the direction of NEPSE. The market's underlying trend, liquidity, investor confidence and developments during the holiday period are likely to matter more.

If history is any guide, investors should therefore look beyond the festival itself. The real question is not whether Dashain is bullish or bearish for NEPSE, but what kind of market Dashain is arriving in.

^{Disclaimer: Markets are prone to volatility and unexpected loss. The stock market is also in a constant debate of those who say "History repeats itself" and those who say "No two events are the same." Be wise. Take your own financial decisions.}