KATHMANDU, Oct 29: Nepal Stock Exchange (Nepse) benchmark index fell 14.63 points this week to close at 1,553.72 points on Wednesday -- the last trading day of the week.
The benchmark index saw correction throughout the week as investors grew nervous over the uncertainty of election in the wake of recent ruling by the Supreme Court to the Election Commission to provide the details about the progress in printing separate ballot papers for upcoming parliamentary and provincial elections.
Though the stock market was largely stable until Tuesday, the ruling on Wednesday by the apex court weakened the confidence of investors who interpreted it as a factor that could make elections uncertain, stock analysts said. The stock market slumped 13.92 points on Wednesday before closing for the week.
The market remained closed on Thursday due to public holiday for Chhath festival.
“The market seemed to be largely stable until Tuesday. There was neither a big correction nor the stocks were surging,” Narendra Sijapati, former president of Stock Brokers Association of Nepal (SBAN), told Republica.
“However, when there was a ruling from the Supreme Court regarding the ballot papers on Wednesday, the stocks started to slump as there were doubts about polls among investors who were upbeat with the indications that election was going to be held on time,” he added.
Responding to a contempt of court petition filed by Rastriya Janata Party Nepal leader Sarvendra Nath Shukla, the apex court on Wednesday had sought details in writing from the EC about the progress made in printing separate ballot papers for parliamentary and provincial elections.
The election body has started to print ballot papers for proportional representation category while it was planning to begin printing ballot papers for the First-Past-the-Post electoral system from Friday.
Election becomes a factor of buoyancy among investors as they believe that the expenses during the polls increase the liquidity in the banking system as well as stirs the country toward a political stability, leading the market toward bullish trend.
Though the stocks did not rally much after the local level polls, analysts have expected the market to climb upwards in the parliamentary and provincial polls as the interest rates are also likely to normalize during this period.
The benchmark index, after hitting all-time-highs in 2016, has remained on a downward path since last year after the banking industry observed shortage of lendable fund and rapid rise on interest rates. However, the stocks are gradually on a recovery course.