5th October 2025, Kathmandu
The closure of the Nepal Stock Exchange (NEPSE) for an additional two days, Sunday and Monday, October 5th and 6th, 2025 (Ashoj 19 and 20, 2082), marks a significant, albeit temporary, halt in the country’s financial activity.
NEPSE Closed for Two Days
This unexpected extension of the post-Dashain holiday period was mandated by the government in response to continuous heavy rainfall and resulting nationwide travel disruptions, posing a critical public safety issue. The decision, though interrupting the planned resumption of trading, has shifted the focus of investors and market analysts toward the highly anticipated post-festival market performance, with a consensus expectation for an uptrend upon reopening.
The Rationale for the Extended Closure
The initial expectation was that the stock market would reopen immediately following the conclusion of the major Hindu festival of Dashain. However, the government’s declaration of two more days of public holidays was a direct safety measure necessitated by the adverse weather conditions. The continuous downpour has not only created flood risks but has also severely impacted national travel.
Crucially, the government has implemented a temporary suspension of long-distance vehicle movement both into and out of the Kathmandu Valley. This decision reflects the reality that a large number of citizens who had traveled to their hometowns across the country for the ten-day Dashain celebrations are now facing considerable difficulties in returning to the capital and their respective workplaces. By extending the holidays, the government aims to mitigate the dangers associated with travel during periods of heavy rainfall and flood risk, allowing for better road clearance and safer transit conditions. This action effectively prioritizes public safety and logistical challenges over the immediate resumption of financial trading.
Investor Expectations and Post-Dashain Market Dynamics
Despite the disruption, the mood among investors and market analysts remains optimistic regarding the market’s trajectory once trading finally resumes. This optimism is fundamentally rooted in a key characteristic of the Nepali financial market during and immediately after the festive season.
The Post-Festival Liquidity Surge:
The Dashain festival, being the most significant and lengthy holiday in Nepal, involves a massive circulation of money throughout the economy, largely driven by salary bonuses, remittances, and family expenditures. A significant portion of this circulated money is expected to seek productive channels, with the stock market being a prime destination. This anticipated influx of funds translates into increased market liquidity—the availability of cash for investment—which is historically a strong precursor to market growth.
Improved Investor Sentiment:
Beyond the physical flow of money, the sentiment of the investment community is also expected to be a major driving force. The festive period often brings a psychological uplift, a sense of renewed purpose, and financial planning, all of which contribute to positive investor confidence. Market analysts suggest that this combination of high liquidity and improved sentiment could provide the necessary impetus to push the NEPSE index upwards in the week following its eventual reopening. Investors are positioning themselves to capitalize on this predicted post-festival surge, viewing the unexpected two-day closure as merely a delay before an upward swing.
Implications for the Financial Sector and Economy
The two-day closure has several implications for the broader financial sector:
Delayed Trading Volume: The total trading volume and value that would have been processed on Sunday and Monday will now be concentrated into the subsequent trading days, potentially leading to a higher-than-average volume in the immediate aftermath of the reopening.
Logistical Pressure: Banks, brokers, and clearing houses may face pressure to handle the backlog of transactions, settlements, and customer service inquiries that have accumulated over the long holiday period.
Focus on Weather Resilience: The reason for the closure—adverse weather impacting essential travel—highlights the vulnerability of the national economy and financial activity to natural events. It underscores the need for greater infrastructure resilience to minimize such disruptions in the future.
Connecting to Rural Livelihoods
The stock market’s closure due to road blocks and rain echoes the challenges faced by other local sectors, such as the homestays in Parbat district, which were also left silent for similar reasons. The nationwide impact of the continuous monsoon reveals a systemic problem where essential economic and tourism activities are frequently paralyzed by heavy rainfall and subsequent landslides, as road connectivity is the single most critical dependency for both. Just as the Parbat homestay operators are anxiously awaiting the end of the monsoon to resume tourist arrivals via clear routes, the NEPSE investors are eagerly awaiting the end of travel disruptions for the market to resume and reflect the renewed liquidity from the dashain festival. Both scenarios reflect how the lack of all-weather infrastructure acts as a bottleneck to economic activities in Nepal, whether in the realm of high finance in the capital or community tourism in the rural hills. The government’s immediate focus on safety is warranted, but the long-term solution lies in building resilient roads that can withstand the annual monsoon cycle, thereby ensuring continuous economic and social activity.
In conclusion, the extended holiday for NEPSE is a direct consequence of prioritizing public safety during national travel disruptions caused by heavy rain. This pause sets the stage for a potentially robust reopening, as analysts predict that the increased post-Dashain liquidity and positive investor sentiment will fuel a significant market uptrend once trading activities officially resume in Kathmandu.
For More: NEPSE Closed for Two Days