NEPSE Continues Downward Trend for Third Consecutive Day

The Nepal Stock Exchange (NEPSE) index extended its losing streak for the third consecutive trading day on Wednesday, closing at 2,821.13 points, marking a decline of 25.16 points. The market downturn also affected key indices, with the Sensitive Index falling by 5.70 points, the Float Index dropping by 1.99 points, and the Sensitive Float Index losing 1.84 points.

Trading Volume Declines Amidst Market Caution

The overall trading volume reflected the bearish trend, as share transactions totaled NPR 10.97 billion, down from NPR 13 billion in the previous session. Investors exchanged 233.43 million shares across 101,603 transactions, involving 308 different stocks. The drop in trading volume suggests a cautious approach among market participants, possibly influenced by broader economic factors and uncertainties.

Gainers and Losers: Microfinance and Hydropower Shine, Finance Sector Struggles

Despite the market decline, Samaj Laghubitta Bittiya Sanstha and Guardian Micro Life Insurance stood out by hitting their positive circuit levels, the maximum allowable daily price increase. Additionally, Unnati Sahakarya Laghubitta Bittiya Sanstha saw its stock price surge by nearly 10%, while Mountain Hydro Nepal recorded an increase of approximately 9%.

On the losing side, Green Development Bank faced the steepest drop, with its stock price plummeting 6.84%.

Key Stocks by Trading Value

Among the most actively traded stocks:

• Himalayan Reinsurance led the market with transactions worth NPR 967 million.
• Nepal Reinsurance Company followed closely, with shares worth around NPR 900 million changing hands.
• Sagarmatha Hydropower Company recorded trading transactions worth approximately NPR 310 million.

Sectoral Performance: Finance Sub-Index Sees the Biggest Drop

Out of 13 sub-indices, only the Trading sub-index managed to record gains, rising 0.43%. Other sectors struggled:

• The Finance sub-index suffered the biggest decline of 1.55%.
• Key sectors, including Banking, Development Banks, Hotels and Tourism, Investment, and Life Insurance, each saw declines exceeding 1%.

Market Sentiment: Investor Caution Prevails

The persistent decline in the NEPSE index and the decrease in trading volume indicate growing investor caution. Various economic indicators, global market trends, and domestic policy uncertainties could be contributing to the bearish sentiment in Nepal's stock market. Analysts suggest that upcoming economic data and regulatory policies may play a crucial role in shaping the market’s direction in the coming weeks.