KATHMANDU: The stock market, which was panicking earlier, has started showing enthusiasm again. The stock market index gained 114.70 points to 2,623.56 points on Tuesday. The indicator has also increased in turnover. More than Rs 7.61 billion worth of shares have been traded today.
Both the increase in Nepse and turnover have made the country more optimistic. 27 companies have grown in positive circuit labels. All groups have increased indicators. The finance group has been the fastest. The indicator for this group increased by 9.74 percent.
The market has signaled the end of the correction phase. After the correction phase, Nepse seems to be able to gain momentum in a new way. Overall, the market is believed to be in a bull run. When you are in a bull run, the tendency to increase is greater than it happens. At such times, common investors are more enthusiastic.
For rapid market growth, the indicators and turnover should gradually accelerate. Only then can the market move forward towards sustainable improvement. As the turnover increases, the supply in the market can be easily consumed. This can strengthen the demand side in the market. This is how you can raise share sisters.
Therefore, as the indicator increases, business usually improves. After the market starts to grow, the confidence of new and old investors increases. Buying is faster than selling, which increases turnover. Earlier, the Nepse was negatively affected by the increase in profit books from the market.
Shares in the market have become very cheap due to the correction. Those who have booked profits earlier are now likely to enter the buying process as the shares are again very cheap. The market can pick up momentum if buyers start becoming active.
According to the cyclical rules of the stock market, the bull run seems to have started. Earlier, our market was in a bearish cycle for three years. Earlier, the market went through a bearish trend for a long time. On this basis, the market seems to be moving in the upper direction over time. While in a bull run, the market could set new records by breaking all previous records. But it will take some time.
Likewise, the overall climate for stock market recovery now looks positive. Main Bank interest rates have been reduced. The liquidity in the system is quite comfortable. This is expected to have a positive impact on the stock market.
Similarly, the government seems committed to stock market reform. The central bank is issuing policies to support the market. On this basis, analyzes are being conducted to travel above the market through correction according to the rules.
There seems to be less risk in buying shares now. Dividend season has run its course. Shares are cheap. The increase in the number of brokers has increased their search for new customers and the number of investors in the market. These factors suggest that overall market momentum will remain positive in the coming days.
However, ordinary investors are more likely to invest in companies with strong financial indicators and good dividend capacity, taking into account their risk bearing capacity. You can study the company’s profitability, reserves, earnings per share, net worth, dividend distribution capacity, past dividend history, company directors and other factors.
More than 17.5 million shares of 307 companies were traded on the day. NLG Insurance topped the list with a turnover of more than Rs 288.2 crore. Similarly, Himalayan Reinsurance and Nepal Finance came in second and third places respectively.