NEPSE edges higher after 3-day fall; turnover softens as new budget policy signals reform

The stock market ended Friday’s session with a modest gain, even as trading volume declined compared to the previous day.

The NEPSE benchmark index rose by 1.77 points to close at 2,731.94, recovering slightly after a recent downward trend. Despite the index uptick, overall market activity slowed.

Total turnover fell to around NRs 3.1 billion, down from NRs 3.3 billion on Thursday. A total of 338 listed companies were traded, with 7.93 million shares changing hands through 43,674 transactions.

Market breadth remained balanced. Of the traded stocks, 127 advanced, 120 declined, and 22 remained unchanged, indicating a neutral investor sentiment.

In major movers, the 7% Nabil Debenture 2089 led the gainers, rising 7.71% to Rs. 1,145 per unit. Modi Energy also posted strong gains of over 5%, closing at Rs. 238.

On the losers’ side, Union Hydropower recorded the steepest fall, dropping 14.79% to Rs. 455. Crest Micro Life Insurance also declined by nearly 6%, closing at Rs. 1,137.80.

Despite the sharp decline in its price, Union Hydropower topped the turnover chart with Rs. 306.6 million worth of shares traded. Api Power followed with Rs. 114.4 million, while Reliance Spinning Mills saw over Rs. 86 million in transactions.

Sector performance was mixed, with 7 of 13 sub-indices closing higher and 6 declining. The “Others” group fell the most, while banking, finance, hydropower, insurance, hotels & tourism, and trading sectors posted mild gains.

Overall, the market showed a cautious recovery in index points but weaker participation from investors.

Capital market in new budget policy

The government has unveiled its policy and programme for FY 2026/27, announcing capital market reforms, and measures to boost domestic and foreign investment. The policy framework positions the capital market as a key driver of economic growth and capital formation.

The government now outlines clearer plans, including expanding institutional investors, developing the bond market, and introducing modern financial instruments. It also aims to link the capital market with productive sectors, infrastructure financing, and diaspora investment. 

The policy aims to broaden participation in Nepal’s capital market by increasing the involvement of institutional investors, including pension funds, insurance companies, mutual funds, Non-Resident Nepalis (NRNs), and foreign institutional investors (FIIs). 

To expand long-term financing, the government plans to develop the bond and loan markets while mobilising diaspora and private investment for infrastructure projects. The policy aims to channel capital market resources into infrastructure development, broaden the use of public debt instruments, and promote project-based financing through bond issuance.

The policy also commits to strengthening anti-money laundering measures and reforming the capital market in line with international standards, including restructuring NEPSE, country’s sole stock exchange, and Securities Board of Nepal (SEBON) along with CDS & Clearing Ltd.