Investors are set to closely monitor the Nepal Stock Exchange (NEPSE) today as trading resumes following the announcement of the government's fiscal year 2083/84 budget by Finance Minister Dr. Swarnim Wagle.

The market's reaction will provide the first indication of how investors view a budget that includes several significant reforms aimed at strengthening Nepal’s capital market and addressing long-standing concerns raised by the investment community.

In the final trading session before the budget announcement, the NEPSE Index gained 4.99 points to close at 2,782.10, registering a modest increase of 0.17 percent. Today's trading session is expected to test whether the budget's policy measures can translate into improved market sentiment.

One of the most widely discussed provisions in the budget is the government's decision to treat capital gains tax on the sale of securities of listed companies as a final tax. The issue has been a major source of uncertainty among investors for years, with debates over whether additional tax liabilities could arise beyond the tax already deducted during transactions.

Although some confusion emerged following the publication of the Economic Bill, Finance Minister Wagle later clarified during a post-budget press conference that capital gains tax would indeed be considered a final tax.

According to market experts, removing tax-related ambiguity is a positive development that could improve investor confidence and encourage greater participation in the market.

Beyond tax reforms, the budget outlines several ambitious initiatives for Nepal's capital market. These include restructuring the Nepal Stock Exchange (NEPSE), introducing intraday trading, allowing short selling, and gradually launching derivative instruments.

The government has also announced plans to introduce separate legislation governing securities market management, market offenses, and penalties. Additional reforms include a new Trustee Act to regulate financial trustees and a zero-tolerance policy toward share cornering, insider trading, and other market manipulation practices.

Another notable announcement is the government's commitment to enabling Nepali companies to access international capital markets through the issuance of Global Depository Receipts (GDRs), potentially expanding fundraising opportunities beyond Nepal's borders.

While many investors have welcomed these reforms, market participants will be watching closely to see whether the positive policy signals outweigh concerns related to tax adjustments and broader economic conditions.

The direction NEPSE takes today could provide an early indication of investor confidence in the government's vision for the future of Nepal's capital market.