Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: The stock market trading has been suspended for the rest of the day after the Nepal Stock Exchange (Nepse) benchmark index nosedived by 6 percent.
The fall of the benchmark index by 6 percent, or 123 points, triggered the circuit breaker leading to the halt of the trading for the rest of the day.
The triple-digit decline is possibly the highest single-day correction in the stock market. Nepse imposes circuit breaker that leads to a trading halt when there is excessive volatility in the market.
The stock market, which had surged to a new high last week, saw a massive correction on Sunday—the first trading day of the week.
With a slump of 123.34 points, Nepse benchmark index now settled at 1,932.11 points.
While many attribute the decline to the rush of investors to book profits from the stocks that have observed massive price gains in the recent rally, other interpret the correction as the market’s reaction to the last week’s first quarterly review of the monetary policy for the current fiscal year 2020/21.
In its first quarterly review of the monetary policy released last week, the Nepal Rastra Bank (NRB) has announced that it will review the existing provisions related to share market lending real estate loans and overdraft loans.
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