The benchmark index, which opened at 548.40 points on Sunday, closed at 527.98 on Thursday, the last trading day of the week, after shares of leading listed companies fell over the week.[break]
“The market was expecting formation of a government led by political parties so that it could come up with new policies and programs,” Stockbroker Nanda Kishore Mundada said. “Since that did not happen, stock investors did not respond positively.”
Last week, major political parties approved formation of a technocratic government under Chief Justice Khil Raj Regmi to hold fresh Constituent Assembly elections. On Thursday, he was sworn in as chairman of the interim government. Soon after his appointment, the benchmark index had rallied to around 40-month high of 560.34 points.
But after Mohan Baidya-led Communist Party of Nepal-Maoist and 21 fringe parties objected to the move, the index started moving downhill and ended the day at 548.4 points - up 2.26 points than Wednesday´s 546.14 points.
“The threats issued by Baidya-led Maoist party and other political parties to hold protest programs in the coming days have also dampened investor confidence,” Mundada said.
Among leading listed companies, the biggest loser over the week was Everest Bank, which saw its share price plunge Rs 68 to close at Rs 1,592 on Thursday. Shares of Himalayan Bank also lost Rs 60 over the week to settle at Rs 781. Nabil Bank and Standard Chartered Bank Nepal, meanwhile, shed Rs 41 and Rs 40, respectively, over the week to end at Rs 1880 and Rs 1865, while Nepal Investment Bank was down Rs 20 at Rs 796.
Because of losses made by these banks, the entire banking sub-index fell 20.27 points, or 3.69 percent, to close at 528.02 points on Thursday.
“Share prices of many listed companies fell during the week also because of profit booking as stock prices have gone up significantly in the past several weeks,” Mundada said.
Over the week, shares of state-controlled Nepal Telecom, which contributes to around 25 percent of the total market capitalization, also took a beating, with stocks closing at Rs 602 from Rs 650 recorded on Sunday. Shares of leading life insurance companies, like Nepal Life Insurance Company (NLIC) and Life Insurance Corporation (LIC), also fell over the week. Shares of NLIC closed at Rs 2,005, down from Rs 2,050 on Sunday, while LIC ended the week at Rs 995 from Sunday´s Rs 1,035.
As shares of leading listed companies saw reduction in their values, all sub-indices, except manufacturing and hotels, also fell over the week. With this weekly transaction amount at the stock market also dropped by 7.12 percent to Rs 494.60 million, although the share market remained opened for all five days this week as against previous week´s three days due to public holidays.
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