Unrest paralyzes stock trade
The agitation mode of pressing authority for action got fully underway in
the past week in the premises of Nepal Stock Exchange paralyzing trading
for three days. If the officials concerned do not respond to it properly
and to the satisfaction of protestors, the strike might continue this week
NEPSE employees want full implementation of the agreement concluded
between NEPSE and employees' union in the past. Unless this is done, they
are in no mood to discontinue stoppage in the secondary market. They
specifically demand that stock exchange allowance be augmented and the
series of by-laws related to the regulatory body and its staff be updated
through proper amendment.
Officials particularly Finance Ministry first ignored the grievances and
later evaded the issue as "unfeasible." Employees, therefore, resorted to
action from mid-January climaxing into past week's halt of trading.
Political protests in financially sensitive zone appear highly unpalatable
to many investors. It also produces negative impact on investment climate
through complicating instability. The government, observers emphasize,
should now take initiative to talk to protestors and tackle problems
through dialogue without disrupting stock business in NEPSE floor.
Although considered as uncommon in investors' arena, the democratic form
of protest featured prominently in NEPSE twice in 2010. Current picketing
which could be termed the spill-over of the same trend follows week-long
strike in stock market for a week around May 2010 due to Maoist nationwide
stoppage. The General Investors' Association of Nepal had protested in
February last year discontinuing trade for a week.
Nepal's share market, although not big in size, is crucial for feeling the
pulse of investment and economic climate in the country. Some 1.5 million
people participate in it in one way or the other engaging in sale or
purchase of shares. They along with heavy investors are worried over the
instability in NEPSE because of employees' agitation.
Analysts are in the meanwhile worried over the adverse impact of in-house
protest on stock trade that has already been victimized by factors such as
continued political instability and high bank rates.
The first two trading days in the past week was not a disappointment for
NEPSE which looked comfortable with a growth of 3.44 points. Sub-indices
of four groups including hydropower, commercial banks and finance
companies were instrumental in boosting the gain of the market during the
Recording a turnover of 40.82 million rupees through business of 159,743
shares in 2,501 deals, NEPSE closed in the past week at 410.34 points,
some 0.84 % gain over previous week's index of 406.9. nepalnews.com Jan 30 2011.