Selective Buying Lifts Nepal Stock Market Amid Flat Benchmark

The Kathmandu Post observed a week of mixed signals on the Nepal Stock Exchange (Nepse). While the benchmark index barely moved, closing up a mere 0.02 percent, the underlying market activity told a different story. A substantial Rs58 billion increase in market capitalization signals robust investor interest in specific stocks, particularly in the mid-cap and speculative sectors, suggesting a rotation away from traditional large-cap banking counters.

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the recent two-day weekend practice has had a psychological impact on the sector, supporting occupancy and tourism demand.

This shift is partly attributed to seasonal optimism surrounding the Nepali New Year 2083 and an anticipated surge in tourism. The Hotel and Tourism sub-index saw the most significant gains, rising 5.13 percent. Analysts also pointed to the recent implementation of a two-day weekend as a positive psychological factor for the hospitality sector, potentially boosting occupancy rates and demand.

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the RSI should remain above 60 for the market to enter an aggressive bullish phase. He described current conditions as sideways, noting reluctance to fall and signs of accumulation.

Energy stocks also showed strength, with the Hydropower sub-index climbing 1.95 percent. Notably, low-cap energy stocks experienced dramatic surges, up to 46 percent, indicating a high degree of speculative trading. While the broader market indices and technical indicators suggest a period of consolidation and weak directional momentum, analysts remain cautiously optimistic. They believe that sustained upward movement could emerge next week, provided there are no adverse political developments. The market's ability to absorb selling pressure and show intraday buying strength on Friday offers a glimmer of hope for a more bullish trend ahead.

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intraday buying pressure on Friday’s final trading session signalled strength, helping the index close higher by 5.36 points.