Nepse surges by 50 points on Monetary Policy
Share market reacted positively on Monetary Policy – that directed banks and financial institutions to hike paid up capital to Rs 8 billion by next two year – as Nepal Stock Exchange (Nepse) today leaped by 50.57 points to close at 1,053.95 points.
The banks and financial institutions dominated share market went euphoric forcing transactions to be halted twice, though the rally will not last long as the banks and financial institutions will not be able to give return as they have been in last couple of years.
The trading closed for the day today as the Nepse surged by more than three points within
the 15 minutes – at 12:16pm – of opening, and by four per cent within half an hour – at 12:39pm – and by five per cent in an hour – at 1:14pm – according to Nepse regulations. The regulation states that transactions are halted for the day when the market fluctuates more than five per cent.
The insurance group was the largest grosser – of 200.34 points – today followed by hydropower with 106.98 points, banking with 60.67 points and development banks with 29.82 points.
Despite the massive surge in the share market, the volume of transactions stood at only Rs 340.36 million, though the market capitalisation reached Rs 350.27 billion.
The share market leaped by 40.11 points on Thursday – when the central bank unveiled Monetary Policy for the current fiscal year 2015-16 – before crossing the 1,000-point mark.
Share market analyst Rabindra Bhattarai said the wild growth in the market was not sustainable. Investors have rushed to buy shares in anticipation of getting bonus and right shares, he said, adding that the capital market may not follow a similar upward trend in the long run as the financial position of financial institutions that will be merged will be uncertain.
The Nepse looks to surpass the previous record of 1,075 points shortly.