Nepse retreats as profit-taking slows post-Dashain rally

The Nepal Stock Exchange (Nepse) has entered the Tihar break with weakening momentum, but its broader upward trend remains intact. The benchmark fell 34.93 points, or 1.3 percent, to 2,655.22 points during the November 2-6 trading week as investors booked profits following the post-Dashain rally and trading activity slowed. The decline was accompanied by a 17.88 percent drop in weekly turnover to Rs28.24 billion from Rs34.39 billion in the previous week.

Average daily turnover fell to Rs5.65 billion from Rs6.88 billion, while market capitalisation contracted by around Rs60 billion to Rs4.57 trillion. The simultaneous fall in prices and turnover points more towards reduced market participation and profit-taking than aggressive selling. Investors appear reluctant to commit fresh capital, while traders are increasingly selective about individual stocks.

However, the contraction in turnover also suggests that the market lacks sufficient buying pressure to sustain another rally. Eleven of the 13 sectoral indices ended the week lower.