Nepal's stock market, a key economic indicator, has been witnessing significant fluctuations lately.

The Nepal Stock Exchange (NEPSE), which had risen impressively from 2,030 points to over 3,000 points recently, is now experiencing a mix of minor fluctuations and significant highs and lows.

On Wednesday, it dropped by 90.73 points, ending the day at 2,739.46 points.

This week started with a notable drop as the NEPSE index fell below 2,700 points on Sunday, ending the day at 2,695.93 after a decline of 53.63 points. 

On Monday, however, the market rebounded strongly with the NEPSE index rising by 127.32 points, a 4.72% increase, reaching 2,823.25. 

Tuesday saw a modest improvement, with the index climbing by 6.90 points to settle at 2,830.

Despite peaking in the past two weeks and experiencing a slight decline, the overall stock market is still up. Share market experts say that the market is unlikely to decline immediately. 

Dharmaraj Sapkota, Chairperson of the Stock Brokers' Association of Nepal, stated that there are several factors supporting a positive outlook for the market, making a decline less likely. He noted, "The investment environment in the capital market is improving due to the growing number of individual and institutional investors in the secondary market, sufficient liquidity in the banking system, and the decrease in bank deposit interest rates."

Recent policy changes from the Central Bank, such as lifting the cap on maximum share mortgage loans for institutional investors, have also been noted. This move allows investors to acquire more shares through loans secured by share securities. Experts believe that the current market fluctuations are a result of corrections in a rapidly rising market.

Chhote Lal Rauniyar, a fundamental analyst and investor, commented on the enduring enthusiasm among investors: "Despite a slight dip in the NEPSE from its peak, investor enthusiasm remains strong. There are approximately 2.3 million investors currently active in the secondary market, and the number of new investors has grown over the past two months."

He said that this influx has led to increased excitement during market upswings and heightened panic during downturns. 

Rauniyar linked this strong enthusiasm to supportive policies and sufficient capital in the banking system: "Due to a share market-friendly finance minister, a share market-friendly monetary policy, and ample investable capital in the banking system, enthusiasm in the share market remains robust."

Analyst Bishnu Prasad Basyal, known for his technical analysis of Nepal's share market, advised investors to consider both technical and financial analysis. He also suggested that the market could experience technical growth. "Despite potential minor fluctuations, the market is expected to follow a trajectory from 2,860 to 2,870 points and could potentially reach 2,900 points," Basyal said.

Chairperson Sapkota also said that for the country's economy to become sustainable, the capital market must first be sustainable. "Currently, there are more traders than investors in the market. When the market falls, both investors and brokers encounter challenges, so it's important for investors to evaluate their own business capabilities," Sapkota added.