Historical Trends Crown July as the Ultimate Bull Month

The structural design of the Nepal Stock Exchange (NEPSE) reveals a highly distinct, psychologically driven calendar effect that shapes investor fortunes year after year. The trading year typically builds toward a crescendo in July (Shrawan), which functions as the traditional "bull month" for local equities. This surge is sparked by an influx of vital corporate data as companies close out their fiscal books and preview their final annual balance sheets. Driven by the high probability of securing lucrative dividends, investors rapidly inject liquidity into the market, driving the index up by an average of 6.00% during this peak window. However, this intense market optimism historically creates its own undoing. By August and September, the momentum reverses entirely into what analysts refer to as a "post-dividend hangover." As companies go through book closures and distribution dates, widespread profit-taking triggers sharp, multi-sector corrections. The cycle remains muted until mid-winter, where a secondary wave of momentum emerges in January. During this period, smart money frequently rotates away from large-cap financial institutions and into agile, low-cap alternatives like microfinance and insurance companies, taking advantage of a fresh calendar year to position for late-stage market adjustments.