Nepal Stock Market plunges to one-year low, NEPSE falls below 2,500 points

KATHMANDU: Nepal’s share market fell sharply on Thursday, hitting its lowest point in a year as investor confidence continued to erode amid weak market sentiment and low institutional participation. The Nepal Stock Exchange (NEPSE) index dropped by 18.40 points, closing at 2,487.45, falling below the critical 2,500-point mark for the first time since mid-October last year.

According to NEPSE data, out of 251 listed companies, 45 gained, 197 declined, and 9 remained unchanged. The market turnover, however, saw a slight uptick — reaching Rs 3.27 billion, up from Rs 3.10 billion on Wednesday, indicating modest buying in selective stocks despite the overall bearish trend.

Market Trend and Sector Performance

The decline was broad-based across most sectors except the banking index, which edged up by a marginal 0.02 percent. The development bank, finance, and hydropower sub-indices led the fall, declining by 1.15 percent, 1.28 percent, and 1.03 percent, respectively. The life insurance and non-life insurance sectors slipped by 0.89 percent and 0.53 percent, while the investment, manufacturing and processing, and microfinance sub-indices also declined.

The “others” category suffered the steepest drop, sliding 2.21 percent, followed by the trading sector, which decreased by 0.39 percent.

Gainers and Losers

Among the individual stocks, Himalayan Power Partner Ltd. was the day’s top gainer, soaring 9.93 percent, followed by Kalika Laghubitta which rose 5.69 percent, Infinity Laghubitta climbing 3.89 percent, and Sagarmatha Lumbini General Insurance up 3.79 percent.

On the losing side, Samaj Laghubitta Bittiya Sanstha plunged 10 percent, the day’s sharpest decline. Unique Nepal Laghubitta tumbled 7.33 percent, Samata Domestic Laghubitta fell 6.25 percent, Upper Syange Hydropower dropped 4.87 percent, and Nepal Reinsurance Company declined 4.21 percent.

Top Active Stocks

In terms of transaction volume and value, Muktinath Bikas Bank, Nepal Reinsurance Company, Shivam Cements, NRN Infrastructure and Development, and Himalayan Reinsurance were the top five actively traded companies of the day.

Market Sentiment and Outlook

Market analysts attribute the ongoing decline to prolonged investor uncertainty, tight liquidity in the banking sector, and weak momentum from institutional investors. Despite occasional rebounds, the overall sentiment has remained negative since early October as investors await clarity on interest rates and economic indicators from the Nepal Rastra Bank (NRB) and the Ministry of Finance.

Analysts warn that continued weakness below the 2,500-point support level could trigger further sell-offs unless new liquidity or positive policy signals are introduced. The NEPSE’s consistent decline also reflects caution among retail traders amid reduced margin lending and subdued trading volumes.

With the festive season approaching, brokers are anticipating limited market movement as investors shift focus toward the Tihar and Chhath festivals. However, some expect that increased liquidity flow from festival remittances could provide temporary relief to the secondary market.