Nepal Stock Exchange Soars, Triggers Circuit Breaks After Power Coalition Shift in Politics

Nepal's stock market soared after a change in government, triggering two circuit breakers within the first hour of trading. The NEPSE index jumped 98.69 points, raising questions about investor confidence in the new coalition.

KATHMANDU, Nepal (March 4, 2024) – The Nepal Stock Exchange (NEPSE) witnessed a dramatic surge today, prompting two circuit breaks within the first hour of trading. This volatile market activity comes on the heels of a recent shift in Nepal’s political landscape, with a new power coalition taking the reins.

Trading commenced at 11:00 AM, and within a mere three minutes, the NEPSE index skyrocketed by 4% compared to the previous day’s closing. This triggered the first circuit break, a mechanism that automatically halts trading for 20 minutes to cool down the market and allow investors to reassess their positions.

Following the brief pause, trading resumed, only to be met with renewed enthusiasm. Within a minute of reopening, the index surged another 5%, exceeding the threshold for a second circuit break. This time, trading was suspended for 40 minutes. When the market reopens at 12:04 PM, all eyes will be on whether the upward trend continues.

As of the latest update, the NEPSE index sits at a staggering 2,059 points, reflecting a significant increase of 98.69 points since the morning’s opening. Market analysts are scrambling to decipher the cause of this sudden bullish sentiment.

Some experts believe the recent political shift has instilled investor confidence, anticipating positive economic policies from the new coalition government. Others speculate that pent-up demand, combined with a correction in stock prices, is driving the surge.

The unprecedented back-to-back circuit breaks highlight the sensitivity of the Nepali stock market to political developments. While the immediate future remains uncertain, one thing is clear: today’s events have injected a dose of excitement and volatility into the Nepali financial landscape.

Investors are advised to exercise caution and conduct thorough research before making any investment decisions in this dynamic market environment. Analysts will closely monitor the situation as trading resumes, eager to see if the NEPSE index triggers the third and final circuit break, resulting in a complete market closure for the day.

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