Finance Minister Swarnim Wagle’s ‘Booster Dose’ to brokers works — NEPSE rebounds, Surges over 83 points

KATHMANDU: Nepal’s stock market staged a sharp rebound on Monday after a high-level meeting between Finance Minister Swarnim Wagle and representatives of the Stock Broker Association of Nepal, signaling how policy reassurance can swiftly influence investor sentiment.

The benchmark Nepal Stock Exchange index surged by 83.33 points to close at 2,760.02, recovering part of the steep losses seen since the formation of the new government. The market had previously declined by around 274 points amid heightened uncertainty.

Policy Assurance Triggers Market Turnaround

The rebound came shortly after Finance Minister Wagle held a 30-minute discussion with broker representatives at Singha Durbar, where he assured that the government is committed to capital market reforms and that investors need not panic.

The minister’s message—urging calm and emphasizing upcoming “better days” for the stock market—appears to have directly restored confidence among investors, many of whom had been selling aggressively in recent sessions.

Earlier, intensified investigations under anti-money laundering measures had triggered panic across the market, leading to sharp declines as investors rushed to exit positions.

Broad-Based Gains Across Sectors

Monday’s recovery was broad-based, with all sectoral indices posting gains. The hydropower sector led the rally, jumping by 4.59 percent. Notably, shares of eight companies hit the upper circuit limit, while investors in 265 listed companies recorded gains.

Total turnover stood at Rs 10.92 billion, slightly lower than Sunday’s Rs 12 billion trading volume, when the market had dropped by over 105 points.

Market Driven by Sentiment Shift

Market participants say the rebound reflects a rapid shift in sentiment rather than a change in fundamentals. A merchant banker noted that investors had overreacted to recent developments, including high-profile arrests and asset investigations.

“The market decline was largely driven by fear. With political stability in place and macro indicators remaining supportive, the minister’s assurance has helped restore some confidence,” the banker said.

Investor Tulsiram Dhakal echoed similar views, stating that panic selling had exposed the immaturity of some investors.

“Capital market funds are largely transparent and routed through the banking system. Once the finance minister clarified the situation, the market responded positively,” he said.

Reform Agenda Back on Track

During the meeting, brokers also reiterated their six-point reform agenda, including implementing recommendations from a capital market reform task force previously formed under former finance minister Rameshwor Khanal.

Minister Wagle reportedly expressed commitment to implementing necessary reforms to strengthen the market structure and improve investor confidence.

Volatility Amid Political and Regulatory Shifts

Nepal’s stock market has remained highly sensitive to recent political and regulatory developments. Following earlier political uncertainty, the index had fallen to around 2,487 before rebounding to 2,960 after elections. However, the formation of the new government and subsequent enforcement actions once again triggered a downturn.

The latest rebound indicates that policy communication and investor confidence remain critical drivers of market direction, especially during periods of regulatory tightening and political transition.