The benchmark index, which opened at 528.93 points on Sunday, shed 8.02 points, or 1.5 percent, to close at 25-day low of 520.91 points on Thursday, the last trading day of the week. [break]
Although the stock market looked upbeat in the initial part of the week, with investors chasing the index to 530.24 points by Tuesday, it started moving downward from Wednesday, as there was no sign of political problems coming to an end, Stock Broker Nanda Kishore Mundada said.
Currently, opposition parties have asked the government to immediately step down to pave the way for formation of a national consensus government. But as the government has shown no indication of quitting anytime soon, the opposition alliance earlier in the week announced its plan to stage anti-government protest march in various parts of the country.
At the same time, a warning issued by Mohan Baidya-led CPN-Maoist on Wednesday to take up arms if the state failed to assure the rights of people has also dampened investor confidence, according to stock market analysts.
"If the political situation continues to worsen, the downward spiral at the stock market will continue for some time," Mundada said.
The weekly report issued by Nepal Stock Exchange (Nepse), the domestic bourse, shows that losses made by bank stocks played the biggest role in causing the benchmark index to fall. Banking index fell 11.24 points, or 2.18 percent, over the week to close at 503.45 points on Thursday.
Likewise, five-rupee reduction in shares of state-run Nepal Telecom, which contributes to around 25 percent of the total market capitalization, also caused the share market to take a dip. Other indices, except for insurance, hotels and manufacturing, also fell over the week.
As investor sentiment remained weak, the share transaction amount at the stock market during the week also fell by a percent to Rs 390.77 million.
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