NEPSE extends losses despite higher turnover; Finance stocks shine

KATHMANDU: Nepal’s stock market continued its downward trajectory on Friday, with the benchmark NEPSE index falling by 11.37 points despite a notable increase in trading volume. The decline comes a day after the market had already shed 13 points, reflecting continued caution among investors even as activity in selected sectors picked up.

The market remained in negative territory throughout the trading session and failed to gain upward momentum at any point during the day.

According to market data, share prices of 74 listed companies advanced, while 184 declined and 11 remained unchanged. Despite the broad-based weakness, investor participation improved significantly, pushing daily turnover higher.

Total trading volume reached Rs 5.61 billion, up sharply from Rs 4.70 billion recorded in the previous session, indicating that investors remained active despite the market correction.

Finance Sector Emerges as Bright Spot

The finance sector stood out as the strongest performer of the day, with its sub-index climbing 2.77 percent. The rally pushed the finance sector index to its highest level since March 28 (Chaitra 15), signaling renewed investor interest in finance companies.

Apart from finance stocks, only two other sectors managed to remain in positive territory. The hotel and tourism index edged up 0.05 percent, while the non-life insurance sector gained 0.06 percent.

Most major sectors, however, ended the day in the red.

The banking index declined 0.44 percent, while development banks fell 0.16 percent. Hydropower stocks lost 0.74 percent, investment companies dropped 0.37 percent, and life insurance companies slipped 0.44 percent.

Similarly, the manufacturing and processing sector declined 0.78 percent, microfinance companies fell 0.16 percent, the “others” category dropped 0.74 percent, and the trading sector declined 0.23 percent.

Kalinchowk Hydropower Leads Gainers

Among individual stocks, Kalinchowk Hydropower posted the strongest gain of the day, surging 15 percent.

Other notable gainers included:

• Upakar Laghubitta Bittiya Sanstha: up 9.71 percent
• Best Finance: up 7.55 percent
• City Hotel: up 7.06 percent

Several debentures issued by banks and financial institutions also featured prominently among the day’s top gainers, reflecting investor demand for fixed-income and relatively stable investment instruments.

Energy and Hotel Stocks Under Pressure

On the losing side, Hotel Forest Inn recorded the steepest decline, falling 4.22 percent.

Other notable losers included:

• Mabilung Energy: down 4.17 percent
• Ridgeline Energy: down 3.83 percent
• Suryakunda Hydroelectric: down 2.99 percent

The losses in several hydropower and energy stocks weighed on the broader market, offsetting gains in finance companies.

Akhu Khola Hydropower Tops Turnover List

In terms of transaction value, Aankhu Khola Jalvidhyut Company emerged as the most actively traded stock of the day.

Other heavily traded companies included:

• City Hotel
• Central Finance
• Ridi Power Company
• Reliance Spinning Mills
• Best Finance

The concentration of trading in finance and hydropower stocks suggests that investors are selectively repositioning portfolios amid continued market volatility.

Market Sentiment Remains Mixed

Although the increase in turnover indicates stronger investor participation, the continued decline in the benchmark index highlights lingering uncertainty in the market.

Analysts note that the strong performance of finance stocks and rising trading activity may indicate sectoral rotation rather than broad market weakness. However, sustained recovery in the overall market will likely depend on stronger investor confidence, earnings expectations, monetary policy developments, and the pace of economic activity in the coming months.