KATHMANDU, July 28 : The Nepal Stock Exchange (Nepse) index jumped up by 10.97 points to close at 1,646.53 points on Thursday -- the last trading day of the week. 
The benchmark index has been logging gains since the beginning of the Fiscal Year 2017/18. Last week, Nepse had gone up by 52.18 points.

With listed companies preparing to publish their annual financial results of the last fiscal year, investors are hopeful of getting better dividends. “Listed companies, particularly bank and financial institutions (BFIs), will now publish their annual financial results.

Expectation of higher profits has excited investors,” Narendra Sijapati, the former president of Stock Brokers Association of Nepal (SBAN), told Republica.

Similarly, plan of insurance companies to increase their paid-up capital has also pushed stock prices higher in recent days. 

As insurance companies are unveiling their plan to raise paid-up capital in line with the recent decision of the Beema Samiti to hike the capital floor, investors are awaiting more stock dividends and rights issue. “Capital increment plan has renewed optimism among investors. They are hopeful of getting bonus and rights shares in the coming days. This has increased demand for insurance stocks,” Sijapati, who is also the managing director of Kalika Securities Pvt Ltd, said.

Rise in government spending has pumped more cash into the banking system which was suffering from shortage of lendable fund over the last six months. Amid mismatch in deposits and lending figures, bank and financial institutions (BFIs) for nearly half of the last fiscal year faced shortage of fund to extend loans as most of them have breached prudential lending limit.  Interest rates have nearly doubled in the six months as BFIs scrambled to attract more deposits to get rid of shortage of funds. The tightening of the lending and rise in interest rates has sent stocks downward, according to analysts. 
Now as the deposit volume of BFIs is increasing with the rise in capital expenditure at end of the fiscal year, investors are hopeful that there will be some correction in the interest rates.

Insurance was the biggest gainer of the week as its sub-index jumped by a whopping 407.38 points to close the week at 9,675.93 points. Manufacturing and Processing group followed suit, as its sub-index climbed up 209.22 points to close at 2,651.09 points. The sub-indices of Development Bank and Finance groups also went up 36.74 points and 13.87 points, respectively, to settle at 2,029.4 points and 754.81 points. Hotels group ended 13.77 points higher at 2,315.67 points. Trading group also went up 1.35 points to end the week at 214.11 points. Banking, the heavyweight group in the secondary market, however, shed 14.95 points to close the week at 1,432.78 points. Hydropower and 'Others' groups also fell 9.12 points and 2.31 points, respectively, to close at 1,931.54 points and 692.68 points. 

A total of 9.05 million units of shares of 170 companies worth Rs 5.53 billion were traded in the market this week through 43,368 transactions. The turnover is higher than 16.75 percent compared to last week. 

 
• nepal stock exchange (nepse)
 
• stock brokers association of nepal (sban)