February 6: The understanding between Prime Minister Sher Bahadur Deuba and Election Commission (EC) to hold the local level elections on May 18 had a positive effect on the stock market. However, this enthusiasm did not last long. 

On February 1, the day the EC proposed the election date, the Nepse index increased by 19.29 points and closed at 2891.33 points. However, on Thursday, the first trading day after that, the Nepse index fell by 14.60 points and closed at 2876.74 points.   

Although the Nepse index declined and closed on Thursday, shares worth Rs. 8.61 billion were traded. Most investors believe that the stock market will set a new record during the upcoming elections. 

According to an investor in the stock market, there are ample grounds for the market to reach new heights before the upcoming election. "The stock market has always had a history of rising during elections. Looking at the market trend, this time is different than before. The market will reach new heights before the next election," he said. 

Looking at the history of the election, the growth of the Nepse index has been mixed. The first election of the Constituent Assembly held in 2064, the second election of the Constituent Assembly held in 2070 and the local, state and federal elections held in 2074 show that the rise and fall of the Nepse index has been mixed. 

During the elections held in 2064 and 2070, the Nepse index had increased. 

In the month before and after the election in 2070, the Nepse index had increased by 37 percent. Similarly, the index had increased by 4 percent in the period one month before and after the election of 2064. However,during the three tiers of elections held in 2074, the index has decreased by 7 percent.