Kathmandu: The stock market is slowing down further after the budget. Investors are surprised when the trading volume along with the index slows down. Even when there are talks of one policy reform after another for the stock market, the market has not stirred. It seems that stocks are accumulating in the market. But this pace is moving very slowly. The daily trading volume of some certain companies is high. But the overall market trading volume is low.

Since the central bank has recently reduced the risk burden for large loans, there are analyses being made in the market that large and institutional investors are gradually preparing. That is why the sideways period is long and the accumulation process seems to be slowing down.

The market has spent a very long time on the sidelines. Now, with the beginning of Ashar, the market has spent about 11 months on the sidelines, moving up and down by a few hundred points. This is a very long period of time.

For months, the NEPSE has been moving above 2500 and below 2800 points. That is, the NEPSE has been moving around based on about 300 points. After reaching around 3,000 last year and returning, the NEPSE has almost reached that point. It has been moving around below that. Based on this, it seems that the market has been in a straight line on average for a long time.

Since the NEPSE has not been able to fall below around 2500, many people understand and analyze that its journey will now be upward. Various indicators are also indicating this possibility. The main thing is that bank interest rates have fallen to a very low point. At this time, there is no situation where you can get much interest by keeping deposits in banks. Therefore, depositors seem to be being discouraged.

Similarly, other areas of investment have shrunk. The real estate business is in trouble. New industries have also not been able to open much. The overall economy is still in recession. In such a situation, it is estimated that the stock market itself can initially give positive signals. There are signs that the stock market may be the starting point for improving the stagnant economy.

The government is also taking positive initiatives to improve the stock market. In particular, the central bank is gradually easing the restrictions it had previously imposed on the stock market. There is more liquidity in the banking system. Banks are offering share collateral loans at low prices.

Similarly, the stock market has been in a bearish and sideways phase for a long time. The market has been in a bearish phase since Bhadra 2078 and has been in a sideways phase for about 11 months. There are signs of gradual improvement in the financial condition of listed companies. These reasons seem to have given investors confidence and understanding that the coming days will be positive for the stock market.

As the risk burden of share collateral loans has been reduced through the third quarterly review of monetary policy, there has been a situation where the flow of share loans has become more enthusiastic. As the interest rate on share collateral loans has been reduced, even large investors have become enthusiastic about taking loans.

As share loans increase, demand in the market will also increase and it can be analyzed that it will help to push the overall indicator up. But since sometimes the market does not grow for a long time, ordinary investors should have the ability to buy and hold companies with strong financial conditions as much as possible. Panic selling can lead to further losses.