NEPSE fell by 35.09 points to 2,725.71 points, claiming that NEPSE fell because brokers did not allow them to buy shares on loan and investors were pressured to sell shares to pay dues.
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With only two days left for the end of the financial year, the effect of 'closing effect' has been seen in the stock market. After the NEPSE, which increased by 29 points on Sunday on the first trading day after the monetary policy, suddenly fell by 35 points on Monday, brokers have analyzed it as a 'closing effect'.
As both the broker and the investor have to reconcile the accounts at the end of the financial year, if the broker does not allow to buy shares on loan (the maximum limit given for share trading), the investor has to pay the dues. Due to the fact that shares cannot be bought on loan from the broker and shares have to be sold to pay the dues, the fall in the overall stock market is called 'closing effect' in technical language.
The monetary policy of the next financial year released last Friday has raised the limit of personal loans to be transferred to share securities to 25 lakh rupees. Monetary policy has adopted policies such as increasing the profit of banks and financial institutions, decreasing the spread, and increasing the lending capacity. Due to these arrangements, the index of the sub-group in which banks and financial institutions are listed increased the most on Sunday.
But on Monday, the index of the same sub-group fell by a lot. Even though the monetary policy is favorable for the market, the question has arisen why the growth of NEPSE could not last for one day. "Since the end of the financial year, many brokers have not allowed investors to buy shares on loan and they are asking them to pay the arrears," said Narendraraj Sijapati, the former chairman of the Stock Brokers Association.
He says that this is the main reason why the stock market is falling now. ``Monetary policy for the coming year is not bad for the stock market but NEPSE does not rise much. The reason for this is because of the end of the financial year,' he added, 'due to the effect of the end of the financial year, the market may decrease somewhat on Tuesday and Wednesday, but it can be assumed that the stock market will take the path of growth from next Sunday.'
On Monday, the NEPSE fell by 35.09 points to 2,725.71 points. This decline is 1.27 percent less than the previous day. On Sunday, indices of subgroups including banking, development banks, finance companies, microfinance, and collective investment funds rose by several. On Monday, after the index of the same sub-group decreased by a lot, the overall NEPSE has decreased by 35 points.
Among the 50 companies that came into trading on Monday, the share prices of 198 companies decreased. On this day 72 thousand 601 shares were traded, 21 million 11 lakh 2 thousand 540 shares were bought and sold. Shares worth 8 billion 17 crore 21 lakh rupees have been traded in those purchases. Compared to the previous day, there was a decrease in the share trading on Monday by about 3 billion. Shares worth 11 billion 41 crore 64 lakh rupees were traded on Sunday.
On Monday, all sub-groups indices fell except for hydropower. According to NEPSE, the index of banking sub-group increased by 2.46, development bank 1.48, finance company 1.13, investment 1.25, microfinance 1.23, non-life insurance 1.05, and life insurance 1.36 percent. Indices for hotel and tourism, manufacturing and processing, other and trade sub-groups also declined. But on that day, the index of the hydropower sub-group was positive by 0.15 percent, NEPSE said.
