NEPSE Dips: Investors Disappointed by Unchanged Monetary Policy

Investor disappointment echoed through the Nepal Stock Exchange (Nepse) on Tuesday as the index took a steep dive, shedding 30.56 points amidst the backdrop of unchanged monetary policy in the mid-term review for the fiscal year 2023/24.

The benchmark index closed the trading session at 2,070.59 points, leaving investors disheartened by the lack of new measures to address prevailing economic challenges. Hopes were high for interventions to counter the declining profits of commercial banks, sluggish demand for bank loans, and excessive liquidity within the banking system. However, the unchanged policies failed to inspire confidence among market participants.

Of the companies listed, only 40 witnessed an uptick in share prices, while a staggering 203 experienced declines, with five holding steady. Nonetheless, amidst the gloom, three companies saw their share prices surge, hitting the positive circuit of 10% during the trading session. Himalayan Reinsurance Ltd emerged as the top performer in terms of turnover, with shares worth Rs 325.05 million changing hands. Following closely were Saonapur Minerals and Oil Ltd and Sanima Middle Tamor Hydropower Ltd, with turnovers of Rs 119.64 million and Rs 100.64 million, respectively.

The red tide swept across all trading groups, with every sub-index ending the session in negative territory. The Development Bank sub-index bore the brunt of the losses, plummeting by 2.4%, followed by the Others and Finance sub-indices, which experienced declines of 2.27% and 2.2%, respectively.

Despite the overall downturn, daily turnover exhibited an improvement, reaching Rs 4.65 billion, a notable increase from the Rs 3.56 billion recorded on Monday.

As investors digest the implications of the unchanged monetary policy, attention turns to the potential trajectory of the market amidst persisting economic challenges.