Nepse jumps 14pt amid govt preparation to present budget

KATHMANDU, July 13: Nepal Stock Exchange (Nepse) benchmark index jumped 13.51 points amid government preparation to present the budget for the Fiscal Year 2014/15 in the parliament at 4 pm.

The market closed at 1036.98 points, which is six-year high record. The market had reached this level earlier on September 8, 2008. The market has observed a massive buying pressure in the first trading hour, forcing Nepse to impose the circuit breaker.

Nepse clamped circuit breaker after the benchmark index rose by 3 percent. The market trading, which was suspended following the clampdown of the circuit breaker, however, resumed after 15 minutes. Circuit breaker refers to the measure used by Nepse during large sell-offs of shares to avert the negative effects from sudden rise and fall of the index.

The index-based circuit breaker is imposed in three stages of the Nepse index movement of 3, 4 and 5 percent. If there is 3 percent rise or fall of index during first hour of trading (up to 1 pm), the first circuit breaker is imposed which means there would be a market halt for 15 minutes.

Similarly, second and third circuit breakers are imposed if there is movement of 4 and five percent, respectively, before 2 hours of trading and later. A total of 1.7 million units of shares of 145 companies worth Rs 750.44 million were traded in the bourse today through 4,218 transactions.

Narendra Sijapati, proprietor of Kalika Securities- a brokerage firm, told Republica that the expectations among the investors that Finance Minister Dr Mahat would introduce capital market-friendly policies have driven up the market index.

“Investors are on buying spree with the expectation that Finance Minister would come up with plans to boost the secondary market which would help to propel the market growth,” he added.

Source: Republica