Kathmandu. Nepal’s stock market has been on a downward trend lately. The Nepal Stock Exchange (Nepse) index fell to the 2,600 mark, hitting a six-month low of . Despite the formation of the new government and the announcement of new policies, the data shows that instead of the enthusiasm of the investors, there is a disappointment . The share market was expected to rise after the formation of the government under the leadership of senior leader Balendra Sah of the Rastriya Swatantra Party (Rastriya Swatantra Party) . However, the market has not been able to grow.

Prior to the elections held on March 4, the Rastriya Samachar Samiti (RSP) had announced stock market-friendly policies in its letter . However, the stock market started falling from tomorrow after the formation of the government. On March 26, just before the Balen government was sworn in, the Nepal stock index (NEPSE) was stuck at the high point of 2950.16. However, as of today, the NEPSE index has reached the 2,600 mark when it reached .

In this way, since the formation of the Balen government, the stock market has decreased by 350 points. This is a big drop in the stock market. After the NEPSE index reached 2600 points, the NEPSE index has reached the lowest point of in the last six months. It had closed at 2597 points on December 24. Since then, the Nepal Stock Exchange (NEPSE) index has increased by 2600 points. 

During this six-month period, the NEPSE index reached the highest level of 2,970 (March 11 .But since then, the market has been on an almost continuous decline.

Budget and Monetary Policy could not arouse enthusiasm

If we look at the trend of trading in NEPSE, the stock market has decreased after the budget. Investors have long been demanding that capital gains tax should be the final tax. In practice, capital gains tax was the final tax, but it was not legally recognised. Investors have been asked by Finance Minister Dr. Swarnim Wagle, however, had demanded this. 

Wagle had also made a provision that capital gains tax would be the final tax in the budget for the next fiscal year 2083/84.However, the stock market has not been able to rise. 

In the budget, Wagle had adopted 10 policies for the improvement of the stock market.This included the restructuring of Nepse from to to . However, it did not have much impact in the market. On May 29, NEPSE closed at 2782 points, up by 5points from the previous year, before Finance Minister Wagle presented the budget for the coming year . 

The budget for the next fiscal year was presented on May 29. In the subsequent trading, many had expected NEPSE to reach a positive circuit level. However, the market took the opposite direction. On the first trading day after the budget, the NEPSE index decreased by 26.72 points to close at 2, 755 points. 

Since the announcement of the budget, the NEPSE has decreased by 86 points .If you look at the trend of the entire stock market after the budget, it seems that investors are in a wait-and-see situation. Even in the business, such enthusiasm is not seen in the market. According to Ghanashyam Pandey, president of Nepal Shareholders’ Association, the share market has not been able to rise after the budget due to confusion among investors due to arrest of businessmen. 

‘Due to the arrest, there was a situation of confusion among the investors, what will happen next, which company will be arrested. Pandey said, “The market is always going to be boosted by big investors. Big investors have not increased the budget due to panic. ’

Monetary policy could not bring back the stock market

After the stock market did not rise even after the budget, everyone’s attention was drawn to the monetary policy to be brought by the Rastra Bank. However, the monetary policy did not seem to have taken any such policy for the stock market. 

Monetary policy was probably the shortest in history. In addition, there was a policy to get more loans only by pledging shares of companies with good net worth and good financial condition. 

This has not had much positive impact on the stock market.Nepal Rastra Bank (NRB) Governor Bishwanath Poudel had unveiled the Monetary Policy on July 7. Shares have been traded for only 3 days since the monetary policy was introduced. However, the stock market has fallen for 3 consecutive days. Since the monetary policy was introduced, the NEPSE index has decreased by 51 points . The NEPSE index had risen to close at 2,651 points a day before the monetary policy was announced, but it fell to 2,600 points on Friday. Chiranjibi Nepal, former governor of the Nepal Rastra Bank, said that the stock market has not been able to rise due to the monetary policy to expand loans based on the condition of the company. 

‘We have 70 percent of the banks and financial institutions in the stock market. The policies taken by the central bank have a big impact on the market. Nepal said, “Now it seems to have its effect. ’

Investors have bought the shares of all the good and bad companies, due to which the stock market has fallen after the monetary policy. Kamal Dhital, Chief Executive Officer (CEO) of Pahi Investment Pvt. Ltd. (Broker No. 76), said that the investors have been waiting for the monetary policy after the budget but nothing specific has come into the monetary policy.

‘There was nothing for the stock market in the particular monetary policy. Dhital said, “Now the investors are looking at the Securities Board. ’

Looking at the trend in Nepse, Dhital agrees with what Dhital said.The NEPSE index decreased by 21points between the pre-budget and the day before the monetary policy was announced. However, after the introduction of the monetary policy, the NEPSE index has decreased by 51 points in the last three days. 

Pandey said that the monetary policy has not brought anything good for the stock market, but it has not come badly, so the reason for the current decrease cannot be said to be the monetary policy.Pandey said that after the market came around Rs 2,600, investors started stop-plus, due to which there was pressure in the market. 

‘Since the mid-July is the time for closing, investors are under pressure to sell. Brokers have asked to sell for settlement. Pandey said, “Now the broker has also not given the limit, which is also the reason for the decrease.” ’

Pandey believes that the current situation has arisen because the stock market operates under the weight of many rumors.