Market reopens with after ransomware attack disrupts trading

Trading on the stock market resumed on Tuesday after a one-day suspension caused by a ransomware attack on the data center supporting the trading systems of 72 brokerage firms.

The Nepal Stock Exchange (NEPSE) said the technical problems at Data Hub Pvt. Ltd.’s data center had been resolved and that trading through the affected brokers’ Trading Management System (TMS) had returned to normal.

Nepal currently has 90 brokerage firms, of which 72 use the TMS developed by YCo Pvt. Ltd. Data Hub manages the system’s backup and infrastructure.

The cyberattack was detected early Sunday morning. Data Hub notified YCo that its infrastructure hosting the TMS had been targeted by ransomware and warned that trading might have to be suspended because of potential risks to connected systems.

Although brokers using separate data centers could have continued operating, NEPSE decided to close the entire market to avoid an uneven trading environment in which only some brokers were able to execute transactions.

Market rebounds as trading resumes

Trading resumed Tuesday from 11 a.m. to 3 p.m. The NEPSE index gained 7.06 points to close at 2,654.28, while turnover increased to NRs 7.05 billion, compared with Rs 6.74 billion in the previous session.

A total of 215.9 million shares of 356 securities changed hands. Share prices rose for 137 companies, fell for 131 and remained unchanged for 11.

Mid-Solu Hydropower recorded the largest gain, rising 14.99% to nRs 606 per share. First Microfinance gained 7.75% to Rs 820. Snow Rivers recorded the biggest decline, falling 8.23% to Rs 970, while Narayani Development Bank dropped 6.96% to NRs 749.

Hathway Investment was the most actively traded company, with shares worth Rs 444 million changing hands. Himalayan Distillery followed with NRs 403.6 million, while Ghalemdi Hydropower recorded turnover of NRs 221.5 million.

Seven of the 13 sector indices advanced, led by the Other sector, which rose 1.36%.

Trading activity also increased following the implementation of a reduction in capital gains tax on share transactions. The government had initially raised the rates in the current fiscal year but subsequently reduced them to 3.75% and 5%, with the revised rates taking effect Tuesday.

Securities regulator orders investigation

The Securities Board of Nepal (SEBON) has instructed NEPSE to investigate the circumstances that led to Monday’s market closure and submit a report by September 28 (Asoj 12).

SEBON has also formed a five-member inspection team led by a deputy executive director to examine the technical and other factors behind the suspension.

The regulator said the investigation should identify improvements needed to prevent similar incidents and help make the securities market more secure, transparent and resilient.

While the affected infrastructure has reportedly been restored, further technical assessment is still needed to determine the full extent of the ransomware attack, which systems were accessed and whether any data was compromised.