Bullish NEPSE surpassed the resistance of 1175, will it make a new high?

This week we have asked the experts if the NEPSE will go further than 1205 points. Let’s read what they have to say. Nawin Sah Investor

Upward trend in NEPSE index was seen in recent days mainly due to bullish path of Insurance Sector. However, the reason for the Market Index to breach the resistance level is the compulsory trading of shares in dematerialization form of companies like Chilime and National Life (having maximum market capitalization) from Poush 29.

The process of dematerialization of these shares will take few days of time which will minimize the supply of these shares in the secondary market and maximize the demand. This will lead to increase in share price of these shares. Whereas the smart investors will either wait till the process completes or will invest for short term profit, however the risk will be maximum (demand will decrease with increase in awareness among the investors). NEPSE index may touch or breach the previous height but will not sustain at that level and will again fall down with the correction. Jashma Sainju Financial Reporter

If the economic blockade is solved and a political settlement improves then it will be very positive for the already bullish market. Also full-fledged CDS implementation through dematerializing shares of listed companies will help in the growth of the share market.

Plus, the finance minister has said that the government is working to allow Non-Resident Nepalese (NRN) to invest in Share Market. This is a very positive step for the share market of Nepal.

In my opinion, Microfinance and Hydropower Sectors will be best for investment in coming days. The market should breach the index of 1205 in coming days. Prakash Ghimire Research Analyst

The market is in bullish trend because of compulsory dematerialization for trading as introduced by Security Board of Nepal effective from today.

Proposed dividend from insurance companies is also helping market to go bullish. And also rumors of requirement of increment in paid up capital of microfinance and insurance is also helping the market to go upward in trend.

The investors are investing in stock because lack of others investment opportunities and higher liquidity. The market will lead in hydropower, insurance, development bank and microfinance sector to set a new high.