The amount of business increased when short-term traders who seek to earn short term dominated the market rather than investors who invest for long-term thinking
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In recent days, despite the expected improvement in the NEPSE index, the turnover is continuously increasing. Looking at the data of the last three trading days, shares worth more than 11 billion are being bought and sold every day.
During that period, NEPSE has increased for one day and decreased for two days. Accordingly, NEPSE decreased by 9 points last Thursday, increased by 0.47 points on Sunday and 2.80 points on Monday. Shares worth 12.51 billion rupees, 11.44 billion rupees on Sunday and 13.18 billion rupees on Monday were traded last Thursday. Even though the transaction amount is increasing, the overall NEPSE has not improved as expected.
This tendency of the stock market where the transaction amount increases but the NEPSE cannot increase, analysts have said that traders are more dominant than investors. They argue that the
market is dominated by the short-term trend of trying to earn in the short term rather than the long-term thinking, so the shares are bought many times and this has increased the turnover. "This situation has come about because traders (traders) are more dominant than investors in the stock market," said Narendraraj Sijapati, the former president of the Stock Brokers Association. That group has raised the share price of a company and sold it. This is confirmed by looking at the situation of the companies that have been traded in the last one month.' Sijapati said that the share prices of companies that have no support from anywhere in terms of fundamentals and technology have increased significantly, which also means that certain groups dominate the market.
Similarly, a stockbroker said that an increase in trading volume in general should be lost as a stock market signal. "The fact that the turnover is increasing now means that investors have seen the signs that the market will grow in the future," said the official, "mainly in the upcoming monetary policy, there may be some easy policies related to the capital market."
Similarly, the newly appointed Governor of Rashtra Bank, Vishwanath Paudel, has been generous towards the stock market. In the third quarter review of monetary policy, the risk weighting on equity securities has been reduced to 100 percent. The broker said that this is a very generous policy for the stock market. "It is a different matter that the said policy did not immediately have a positive effect on the stock market, but the decision to reduce the risk burden is a strong evidence that the National Bank is very liberal for this stock market," said the official.
The NEPSE index, which gauges share trading, rose by 2.80 points on Monday. After becoming positive by 0.10 points compared to the previous day, the overall NEPSE closed at 2,658.66 points. It increased by a few points on Sunday. NEPSE showed a slight improvement on Monday. Among the companies that traded on that day, the share price of 124 companies increased while 124 companies decreased.
On Monday, 3 crore 36 lakh 37 thousand 966 shares were bought and sold in 1 lakh 5 thousand 635 shares. Shares worth 13 billion 186 million rupees have been traded in those purchases. The turnover has increased compared to the previous day. Shares worth 11 billion 44 crore 32 lakh rupees were traded on Sunday.
Among the 13 subgroups traded on Monday, the indices of financial companies, hydropower, investment, production and processing and others fell. According to NEPSE, the index of the rest of the subgroups decreased.
