NEPSE Weekly Recap: Market Slips Amidst Volatility and Sectoral Divergence

ShareSanskar | Shrawan 16, 2082

NEPSE closed the week with a significant decline, ending at 2,922.63 points, down by 60.01 points or 2.01% compared to the previous week's close. This marks a notable reversal from last week’s bullish trend, where the index had climbed nearly 3.90%. The week was characterized by persistent volatility, with the benchmark index oscillating between a high of 3,028.79 and a low of 2,915.47, revealing a fluctuation range of 113.32 points, slightly less volatile than the 135.38 point swing observed a week prior.

Despite the bearish momentum, trading activity remained highly energetic. The total weekly turnover reached an impressive Rs 96.89 billion, with an average daily turnover of Rs 19.38 billion. Investors exchanged over 217.87 million shares through 842,023 transactions, highlighting robust participation across the market. The most severe daily decline occurred on Wednesday, with the index falling 47.93 points, coinciding with a turnover of Rs 16.44 billion. By week’s end, the market’s total capitalization stood at approximately Rs 48.77 trillion, underscoring the size and resilience of Nepal’s capital market.

A closer look at sectoral performance revealed a mixed landscape. While several sectors managed to stay in the green, others posted steep losses. The Manufacturing and Processing sector led the gainers with a 1.80% rise, followed by Others (+1.54%), Mutual Funds (+0.34%), Trading (+0.16%), and Development Banks (+0.06%). However, this positive momentum was overshadowed by declines in sectors such as Hotels and Tourism (-4.69%), Life Insurance (-4.15%), Hydropower (-3.65%), and Non-Life Insurance (-2.52%), which weighed heavily on overall market sentiment.

From a technical analysis perspective, Relative Strength Index (RSI) values remain relatively strong, sitting at 63.79 (daily) and 63.86 (weekly). However, the downward trend hints at waning buying momentum. Similarly, the Moving Average Convergence Divergence (MACD) remains positive, but with signs of narrowing, suggesting a potential early-stage reversal or consolidation phase.

While the broader sentiment appears cautious, strong trading volumes and continued investor engagement suggest that market participants are still optimistic in the medium term. Investors will likely monitor upcoming economic cues, policy movements, and earnings reports to gauge the next direction of the NEPSE Index.