The Nepal Stock Exchange (NEPSE) Index closed lower on Wednesday, extending volatility in the secondary market as investors booked profits across several sectors. The benchmark index fell by 17.53 points, or 0.64 percent, to settle at 2,714.05. The decline comes a day after the index had gained 5.08 points, indicating continued uncertainty in market sentiment.
The market opened at 2,731.85 and showed brief signs of strength during early trading hours, touching an intraday high of 2,742.53. However, selling pressure gradually intensified, pulling the index down to an intraday low of 2,710.04 before closing in negative territory.
Trading Activity and Market Capitalisation
Despite the decline in the index, trading activity remained relatively strong. Total turnover for the day reached Rs. 14.56 Arba, reflecting sustained participation from investors. A total of 35,477,939 shares were traded across 320 listed companies through 138,883 transactions, according to NEPSE data.
The overall market capitalisation stood at Rs. 45.56 Kharba, while the float market capitalisation was recorded at Rs. 15.51 Kharba. Analysts note that while the indices has shown short-term weakness, consistent turnover suggests that investor interest in the market remains intact, particularly in select stocks.
Sector-Wise Performance Remains Mixed
Sectoral indices painted a mixed picture during the trading session. The Hydropower Index emerged as the top gainer of the day, rising by 0.38 percent. Hydropower stocks continued to attract investor attention amid expectations of long-term growth driven by energy demand and infrastructure development.
In contrast, the Development Bank Index suffered the steepest decline, falling by 2.23 percent. The drop was attributed to profit booking and cautious sentiment among investors amid concerns over earnings performance and interest rate movements.
Other sectors also witnessed selling pressure, contributing to the overall decline of the benchmark index. Market participants remained selective, focusing on fundamentally strong companies rather than broad-based buying.
Hotels and Tourism Index Slides Sharply
The Hotels and Tourism Index recorded a notable decline during the session, shedding 98.94 points, or 1.29 percent, to close at 7,522.36. This follows a modest gain of 6.94 points in the previous trading session.
The index opened at 7,589.67 and surged to an intraday high of 7,685.56 in early trading. However, sustained selling pressure later in the day pushed the index down to a low of 7,516.30 before closing near the day’s bottom.
Market analysts attribute the decline to short-term profit booking after recent gains, along with cautious sentiment regarding tourism sector earnings. While the sector holds long-term potential, investors appear to be adopting a wait-and-see approach amid mixed signals related to tourist inflows and operating costs.
Investor Sentiment Remains Cautious
Market observers note that the ongoing fluctuations in the NEPSE Index reflect cautious investor sentiment amid global and domestic economic uncertainties. Investors are closely monitoring interest rate trends, corporate earnings, and policy developments, which are expected to influence market direction in the coming sessions.
Analysts suggest that while the market has corrected from recent highs, it continues to find support around current levels. Selective accumulation in fundamentally strong stocks is likely to continue, especially in sectors with long-term growth prospects such as hydropower and infrastructure.
Outlook for the Market
Looking ahead, experts believe the NEPSE Index may continue to move within a narrow range in the short term as investors await clearer economic indicators and corporate results. Sustained trading volume indicates that the market remains active, although sentiment is expected to remain cautious.
Investors are advised to remain vigilant, focus on risk management, and adopt a long-term investment approach amid ongoing market volatility.
