Nepal’s political scene is moving toward an unexpected turn. After days of confusion and pressure, the main opposition UML has finally decided to join the upcoming federal election. This decision is becoming more than a political headline. It is shaping a new mood in the NEPSE market, where investors had been waiting for a clear signal.
UML leaders will reach the Election Commission today to register their party for the House of Representatives election. According to election department chief Niraj Acharya, the registration request will be submitted within the deadline.
The party had already registered for the National Assembly election but had not done so for the federal election. The deadline for federal-level party registration ends on Wednesday.
After the Gen z protests toppled the UML-led government, the Sushila Karki administration announced a midterm election. UML had initially refused to participate and wanted to sit out. But when Nepali Congress, the biggest party in the dissolved parliament, confirmed its participation, UML was left isolated.
Growing political pressure finally pushed UML to step in. With UML’s confirmation, the election is now seen as certain to take place on time.
If all parties take part, the political environment becomes more predictable. This gives the country a chance to correct its political direction and reduce instability. A timely election could guide Nepal into a more settled phase.
UML’s decision is expected to brighten the mood in the capital market. Political uncertainty had created panic and triggered sell-offs. The famous GenZ protest in September 2025 caused a massive 160-point drop in one day, forcing multiple trading halts. It proved how vulnerable the market becomes when politics shakes.
But history shows recovery follows stability. By November 1, 2025, NEPSE had climbed 96.53 points along with a strong daily turnover of Rs 5.05 billion.
Even recently, the index slipped for two straight days during heightened political questions. On November 10, it fell by 35.82 points. Yet the moment there is a hint of stable politics, the market responds quickly.
The World Bank has also cut Nepal’s growth forecast from 5.2 percent to 3.1 percent because of political instability. This shows how important a steady government is for the economic outlook.
A guaranteed rally is never certain. But election clarity increases the possibility. Past trends show the power of stability. In 2021, after the Covid shock, Nepse soared by 48 percent. Recently, in November 2025, the index touched 2654.60 with a small but hopeful rise of 0.14 percent.
Still, risks remain. Global markets, US Fed policy decisions, rising dollar rates and any unexpected political twist before November 26 could affect the trend.
Small markets like Nepal react strongly to political headlines. Technical charts can be overshadowed within minutes. But long-term investors usually benefit when they avoid panic and wait out short-term noise. If all parties register in time and the election happens peacefully, Nepse could begin a steady climb. Political commitment, not speculation, will shape how high the index can rise next.
