KATHMANDU, March 4: Nepal Stock Exchange (Nepse) index rebounded 16.4 points this week to close at 1,329.41 points on Thursday -- the last trading day of the week.
As the stock prices have been going down rapidly in recent weeks, many investors are buying shares to cash in on falling prices, stock market analysts say.
The stock market is in a downward trend for the past few months as lendable fund in the banking system have been drying up. BFIs have also increased margin calls to investors, who have borrowed against share pledges, compelling investors to sell their stocks to either repay loans or deposit money to cover the losses.
“Many investors who are in a better liquidity position have found this an opportune moment to buy shares as prices have been falling rapidly,” a stock broker told Republica. “While the tightening of money toward stock market continues as BFIs are still struggling to find deposits to lend more, some investors are on a buying spree.”
He also said that market can take a recovery path as soon as lendable fund is available in the banking system. As the allotment of follow-on public offering of National Life Insurance Company Ltd has been completed, the money was stuck in the FPO could also return back to market, he added.
Most of the trading groups registered gain this week. Insurance was the biggest gainer of the week as its sub-index climbed up 195.77 points to close at 5,882.26 points. Hotels group also posted a gain of 90.69 points to close at 1,767.38 points. The sub-indices of Hydropower, and Manufacturing and Processing groups also went up 37.28 points and 27.37 points, respectively, ending at 1,568.89 points and 2,165.3 points. Development Bank also ended 15.7 points higher at 1,455.11 points.
Banking, the heavyweight trading group in the secondary market, also jumped 11.87 points to settle at 1,267.13 points. Finance group inched up 0.08 point to close at 607.53 points. 'Others' group, however, shed 4.91 points to close the week at 653.93 points. Trading group remained unchanged at 206.16 points.
Kumari Bank Ltd topped the list of companies this week in terms of turnover (Rs 211.04 million), number of shares traded (490,000 units) and number of transactions (2,360).
A total of 3.32 million units of shares of 150 companies worth Rs 1.53 billion were traded in the market this week through 15,734 transactions.