Share prices head south as investors get cautious

KATHMANDU, 18 August:

The cheerful fourth quarter financial report of financial institutions also failed to bring optimism in the market as share prices continued to slump this week — August 11 to 15.

The benchmark index declined by 6.14 points — that is 1.14 per cent — in the week. Despite the possibility of higher dividends — most probably in the form of bonus shares by financial institutions to reach regulatory paid up capital requirement — investors are not taking chances in the volatile market scenario.

On Sunday afternoon, the market that had opened at 542.69 points reached 539.44 points by the time the market closed. The index steadily headed downhill throughout the week and by the end of the week it rested at 536.45 points.

Investors are not betting much in the current scenario and even the transaction volume increased only slightly by 7.27 per cent this week. The transaction volume that stood at Rs 676.1 million last week increased to Rs 725.26 this week. There were 9025 transactions recorded for 2.6 million unit shares of 127 companies. Last week, 2.07 million units of shares were traded in 9177 transactions.

Share trading of blue chip stocks belonging to class ‘A’ companies comprised of 48.67 per cent of total transactions, amounting to Rs 353 million. The sensitive index that shows the performance of class ‘A’ stocks also declined by 1.76 points. Likewise, the float index that measures the performance of shares actually traded also went down by 0.12 points to 37.65 points.

This week, except for insurance, development banks and manufacturing, the remaining subgroups ended up in the red.

Insurance gained 59.34 points as Nepal Life Insurance gained Rs 151 per unit and National Life Insurance gained Rs 80 per unit, among others.