अन्योल कायमै : बजेटपछि पनि बजार आश्वस्त हुन सकेनUncertainty Persists: Market Remains Unconvinced Even After the Budget

Nearly three months after the formation of the RSP-led government, Nepal’s stock market has yet to regain momentum. The NEPSE index, which stood at 2,950 points on March 25 (Chaitra 12), has now declined to around 2,705 points. During this period, investors have lost an estimated Rs. 400 billion in market value.

Through the budget for the upcoming fiscal year, Finance Minister Dr. Swarnim Wagle announced several reforms, including making capital gains tax a final tax, introducing intraday trading and short selling, launching derivative instruments, and adopting a zero-tolerance policy against insider trading. However, the market failed to respond positively to these announcements, with the benchmark index continuing its downward trend even after the budget presentation.

Experts point to multiple reasons behind the market decline. The government's ongoing property investigation process has created concerns among large investors that they could also come under scrutiny. Cases related to securities fraud have already been filed against individuals such as Deepak Bhatt, Sulabh Agrawal, and several others. As a result, market participants say that even brokers have become hesitant to execute large-value transactions.

Adding to the uncertainty, the Nepal Securities Board (SEBON) has remained without a chairman for more than two months. Although the recommendation committee submitted three names to the government on May 22 (Jestha 8), no appointment has yet been made. Investors fear that, as in the past, the regulator could remain leaderless for an extended period. Consequently, the IPO process of 104 companies worth approximately Rs. 69.30 billion has been stalled.

On the second trading day of the week, the NEPSE index fell by another 6.31 points to close at 2,705.45, marking its third consecutive day of decline. More than 48,000 transactions involving 355 listed stocks generated a total turnover of Rs. 4.04 billion. Out of the 13 sectoral indices, 11 ended in negative territory, while only the Mutual Fund and Trading sectors posted slight gains. In terms of trading volume, Aankhu Khola Hydropower topped the list, while Sopan Pharmaceuticals, Apollo Hydropower, and Dolti Power hit the positive circuit limit.

From a technical perspective, analysts believe the market remains in a sideways phase. The banking and financial sector, however, appears relatively positive, with expectations of 5–10 percent returns during the upcoming dividend season. Most analysts recommend focusing on fundamentally strong companies under the current market conditions, although some warn that the existing technical support level could still break.

Meanwhile, despite the falling market, share-backed lending continues to rise. Over the past ten months, such loans have increased by Rs. 21.83 billion, taking the total outstanding share-backed credit to Rs. 162.53 billion. On one hand, this reflects investors’ financial constraints, while on the other, it signals growing risks within the banking system.

For now, most investors have adopted a “wait and watch” strategy. Some are hopeful that the upcoming monetary policy from Nepal Rastra Bank will introduce market-friendly measures. However, experts argue that there is little room left for the central bank to offer additional support to the stock market, as most of the sector’s major demands have already been addressed.

Despite the presence of a strong two-thirds majority government, the stock market has yet to benefit from political stability. Fear surrounding property investigations, the leadership vacuum at SEBON, and weakening investor confidence have significantly reduced the likelihood of an immediate market recovery.