Stock market bounces back
The stock market bounced back today as it jumped by 38.57 points to close the market at 960.43 points following the central bank’s clarification that it has not been trying to tighten investment of the banks and financial institutions in the capital market.
The central bank has clarified that its directive related to the one-per cent threshold for investment on ‘held-for-trading’ has nothing to do with the stock market downfall and investors need not panic.
Nepal Stock Exchange (Nepse) index had declined by a total of 75.93 points in the last three trading days, until it rebounded today.
The stock market witnessed a buying pressure that led to the suspension of the trading twice due to the circuit breakers. Nepse attracts circuit breaker at three stages, if it goes up or down by three per cent, four per cent and five per cent.
Since the central bank issued a clarification that its one per cent limit for the banks and financial institutions threshold was only for the ‘held-for-trading while 30 percent total investment has remained intact, the investors regained their confidence, president of Stock Brokers Association of Nepal Narendra Sijapati added.
Some of the market players have misinterpreted the central bank directives to mislead the investors, he said, adding that the directive came out all of sudden and sent the market down.
Except Hotels group, all the sub-groups ended in the green zone today pushing the market index up. The insurance sub-group was the highest gainer as it went up by 248.9 points to settle at 3,849.96 points, though hotels sub-group shed 2.49 points to close at 1,866.59 points.
The day witnessed a total of 1.3 million units of shares of 140 companies worth Rs 617.41 million in the market through 3,830 transactions.