On Sunday, the first trading day of the week, the NEPSE index showed a strong recovery signal, rising by nearly 40 points. After declining for two consecutive trading sessions, the market witnessed a notable rebound as the index climbed 39.92 points to close at 2600.22 points. The 2600 level is considered psychologically important for the market, and today’s closing re-established this critical support. Although the market had been under pressure for the last few weeks, today’s performance has strengthened expectations of a potential market bounce in the coming days.

Compared to last Thursday’s trading volume of Rs. 4.68 billion, today’s turnover surged to Rs. 6.28 billion. The total number of traded shares also increased significantly, reaching 13.38 million units.
The rise in both turnover and volume confirms increasing buying pressure in the market. Generally, rising turnover alongside an increasing index is treated as a positive signal, and today’s move reflects exactly that sentiment.

Sunday’s trading session saw improvements in nearly all sub-indices. Out of 13 sub-indices, 12 closed in the green.
The Life Insurance sub-index recorded the highest gain of 2.55%, reflecting heightened investor interest in the insurance sector in recent weeks.
Only the Mutual Fund sub-index ended slightly lower. Similarly, 237 companies saw their share prices rise, 18 declined, and 2 remained unchanged — indicating strong market breadth and widespread buying sentiment.

Three newly listed companies hit the positive circuit limit during the session —

Sagar Distillery
Bandipur Cable Car & Tourism
Jhapa Energy
All of these companies were recently listed on NEPSE, and today’s performance shows strong initial investor enthusiasm.

On the other hand, Peoples Hydropower was the weakest performer of the day, declining 7.65%, making it the biggest loser. The hydropower sector has been under pressure recently, and today’s movement again reflects the selling sentiment in this group.

In terms of total turnover, NRN Infrastructure & Development topped the chart with over Rs. 656 million in transactions.
Second on the list was Peoples Hydropower, with turnover crossing Rs. 340 million.
These figures indicate that investors are heavily focused on a few selective stocks with high liquidity.

One of the major drivers behind today’s market rise is the rumor that the Nepal Rastra Bank (NRB) is preparing to introduce market-friendly amendments in the upcoming Monetary Policy Review.
According to widespread discussions on social media, some major provisions may be revised:

Banks and financial institutions may be allowed to issue share-backed loans beyond the current 40% core capital limit.
Investors may be allowed to hold investments in shares for more than six months without restrictions.
The existing 26-month restriction on certain investment structures may be removed.

Market analysts believe that such policy changes could significantly increase investor purchasing power, enhance liquidity, and strengthen the market’s recovery momentum. Even though the banking system currently has ample liquidity, low credit demand has been limiting economic movement. Hence, there is an expectation that the central bank may bring capital-market-supportive provisions — which has boosted investor confidence today.

Technical Analysis Section

NEPSE has finally broken the downtrend line that had been holding the market for several days, closing strongly above it. According to technical analyst Ajit Khanal, the Dragonfly Doji formed on Thursday indicated a potential reversal, and today’s candle confirmed that signal by breaking the high of the doji and forming a new Higher High (HH). After closing above the middle band (20-day moving average), the market reached and stabilized at the 23.6% Fibonacci retracement level, which makes the probability of trend reversal stronger.

On the volume side, today’s total turnover increased compared to yesterday, which is considered a bullish sign during a breakout. The market opened with a gap-up and remained positive from the beginning, although some supply emerged during the last hour of trading.

Sector-wise, the hydropower sector — which usually dominates market turnover — has now fallen below the 50% share mark, while turnover in the Investment group has increased significantly. Other sectors did not show major deviations.

Broker-Wise Analysis

Data from the top 10 brokers further clarifies market psychology. Out of these 10 brokers, six bought more than they sold, indicating that today’s breakout had support from institutional and large investors.

Brokers 45, 34, 42, 48, 57, and 62 recorded higher buy transactions, while 58, 49, 28, and 44 recorded higher sales.

Stock-wise brokerage distribution shows:

NRN Infrastructure (NRN) was heavily traded through broker 58, where investors purchased 251,000 shares (about 80% of total buy volume) and also sold 271,000 shares (about 80% of total sales).
UMHL saw 62,000 shares (52% of total buys) purchased from broker 62, and 59,000 shares sold from the same broker.
HURJA recorded 56,000 shares bought from broker 84.
Prime Commercial Bank saw 40,000 shares bought from broker 8.