Nepse downfall continues

KATHMANDU, March 18: The Nepal Stock Exchange (Nepse) index continued its bear run on Monday as well, losing 14.54 points to settle at 768.54 points.

In the last three weeks, the benchmark index has dropped value in 10 of the 14 trading days. Though the index had climbed to 64-month high of 831.36 points on February 2, it has lost 62.82 points in the past three weeks.

Apart from some minor corrections, Nepse index had been growing consistently since mid-October when preparations for the Constituent Assembly (CA) polls began.

Narendra Raj Sijapati, president of Stock Brokers Association of Nepal (SBAN), said correction was a usual phenomenon in the secondary market after four-five months of bullish run.

“The market rose continuously for nearly five months. It had to go into correction mode at some point,” Sijapati said, referring to profit booking mood of investors. He, however, predicted that the index won´t go down further.

Remarks on the secondary market by Nepal Rastra Bank Governor Yuba Raj Khatiwada also contributed to the fall in Nepse index, according to stock analysts. During the mid-term review of the Monetary Policy of fiscal year 2013/14, Khatiwada had said the central bank would carefully weigh the provision of margin lending to prevent any bubbles in the secondary market.

Bishwombhar Gautam, a stock investor, said he was surprised by the downfall in Nepse index. “Profit booking sentiment is obviously behind the correction mode in the secondary market. But there might be some foul play,” he said, adding that big investors might be manipulating the market.

All trading groups shed values on Monday. The Insurance group was the biggest loser of the day, as its sub-index tumbled 63.01 points to close at 2,631.11. Close on the heels were the sub-indices of Hotels and Hydropower sub-indices which went down by 48.86 points and 33.68 points, respectively, to end the day´s trading at 1,327.87 and 2,074.36 points.

The Banking and Development Bank sub-indices shed 16.4 and 5.93 points to settle at 702.92 and 489.54 points, respectively.
A total of 537,725 units of shares of 124 companies worth Rs 217 million were traded through 1,854 transactions on Monday.

Source: REPUBLICA