Over the week, the Nepal Stock Exchange (Nepse) index fell 3.43 points, or 0.67 percent, to close at 510.88 points on Thursday -- the last trading day of the week, as most of the sub-indices that have the power to influence the market retreated.[break]
Nepse´s weekly report shows that the banking sub-index, which plays a lead role in determining the direction of the benchmark index, fell to 491.48 points on Thursday from 494.97 points recorded at the beginning of the week. Similarly, the stock price of Nepal Telecom, which contributes to around 25 percent of the total market capitalization, also made moderate losses over the week. Other sub-indices, except hotels, trade and insurance, also fell over the week.
“The mood at the stock market remained grim this week because of the book closure season,” Nanda Kishore Mundada, a stockbroker, told Republica.
“During this season, dividends are distributed and investors, who own shares, wait to get hold of bonus shares and cash dividend, while those planning to purchase shares wait for shares prices to adjust.”
As this has been continuing for over the month, the index lost over 23 points in January alone.
“The stock market probably would have performed better had there been some improvement in the political situation. But as investors saw no sign of political problems coming to an end, they decided to stay away from the market,” Mundada said.
Currently, the opposition parties have asked the government to immediately resign to pave the way for formation of a national consensus government. But as the government has shown no sign of stepping down, many are expecting political problems to worsen further.
As investor sentiment remained bearish, the weekly turnover at the stock market also fell to Rs 321.09 million from Rs 347.56 million recorded in the previous week.
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