Kathmandu | April 24, 2025

The NEPSE index posted a slight gain of 2.08 points (0.07%) on Thursday, closing at 2,658.02. Trading hovered between a low of 2,641.88 and a high of 2,668.06, reflecting a cautious yet resilient session. Market turnover surged to NPR 7.88 billion, with 19.75 million shares traded across 308 companies, lifting the total market capitalization to NPR 4.4197 trillion up from NPR 4.3432 trillion the previous day. Despite the index ticking upward, market breadth remained negative, with only 83 stocks advancing against 161 decliners, signaling selective investor interest and broader underlying weakness.

Sectoral Trends:

Sectoral performance was mixed. Investment banking led the gains with a 2.49% rise, supported by steady moves in trading, mutual funds, and hydropower. The hydropower index saw marginal gains, helped by strong companies like NGPL, UPCL, and Radhi Hydropower. On the downside, the Hotel and Tourism sector declined by 1.16%, as investors booked profits following recent rallies.

Stock Movers: Top gainers and losers

The day's top performers included NMIC and CREST, both hitting the 9.99% upper circuit, followed closely by NGPL, WNLB, and UPCL, which gained between 7% and 7.5%. These high-beta stocks, particularly in insurance and energy, continued to attract speculative interest. On the losing end, NHDL dropped 7.12%, while GRDBL, CORBL, SINDU, and KBSH posted declines ranging from 3.5% to nearly 5%, largely driven by profit-taking in the development banking space.

Foreign Aid Shake-Up: MCC Shutdown Confirmed

In a major geopolitical development, the U.S. government has announced the shutdown of the Millennium Challenge Corporation (MCC). The move follows a 90-day funding freeze and raises serious questions about the future of critical infrastructure projects in Nepal. While ongoing projects such as the 315-km, 400kV transmission line and various road upgrades will reportedly continue, the closure introduces uncertainty regarding long-term financing and oversight.

The MCC agreement had promised $500 million in U.S. grants, with the Nepal government committing an additional $197 million. Now, with the agency being wound down, the sustainability and impact of these projects are under fresh scrutiny, particularly in sectors like energy and logistics that are sensitive to foreign investment trends.

Outlook: Volatility to Persist

While Thursday’s gain offers a positive headline, the underlying market tone remains cautious. With sectoral divergences becoming more pronounced and geopolitical risk re-entering the equation, investors may need to brace for heightened volatility. Close tracking of earnings results, government policy updates, and foreign aid developments will be key to navigating the road ahead. Despite uncertainties, the market’s resilience is notable. Let’s hope NEPSE builds on this momentum in the sessions ahead.