Daily Market Commentary

Nepse climbs higher as bank stocks regain footing

Published On: June 14, 2021 10:18 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, June 14: The equity market continued to see strength as Nepse traded in green throughout Monday’s trading. Stocks moved sharply higher in the first trading hour with Nepse reaching as high as 3,050. However, the bourse gave up most of its early gains in a sharp mid-day pullback. The benchmark hovered around 3,020 mark thereafter, finally ending Monday’s trading at 3,025.83.

A high opening mark and further gains in the day reflect buyers control over the market. Even though some sectors witnessed correction on the day, others including heavyweight banks helped the market close firmly in green. Besides, the bourse also continued to see massive enthusiasm with a turnover of over Rs. 18 billion in the session. 

Sectors maintained positive bias. Hotels and Tourism sub-index rallied the most climbing more than 4% on the day. Investment Index also rallied over 3.36%. Banking, Manufacturing & Processing and Non-Life Insurance sub-indices witnessed notable charm as all sectors shot up by over 2%. Finance and Life Insurance segments also ended in green. On the other hand, Development Bank stocks corrected over 1% on average, followed by ‘Others’ sector which went down by over half a percent. Microfinance, Trading, Hydropower and Mutual Fund indices inched marginally lower. 

Shares of Arun Valley Hydropower Development Company Ltd led the list of actives for a second straight day. Over Rs. 625 million worth of the energy scrip changed hands. Furthermore, Api Power Company Ltd and Himalayan Distillery Ltd registered turnovers of RS. 549 million and Rs. 503 million. Nepal Reinsurance Company Ltd, Lumbini Bikas Bank Ltd, Arun Kabeli Power Ltd and National Hydropower Company Ltd were the other active stocks of the session. 

Nepal Insurance Company Ltd, Khanikhola Hydropower Co. Ltd, Joshi Hydropower Development Company Ltd and Ghalemdi Hydropower Ltd shot up by exactly 10%. Ngadi Group Power Ltd, Oriental Hotels Ltd and CEDB Hydropower Development Company Ltd were among other major advances. 

Conversely, Mountain Hydro Nepal Ltd and Arun Valley Hydropower Development Company Ltd fell the most, correcting 5.01% and 4.70%, respectively. United Modi Hydropower Ltd, Goodwill Finance Co. Ltd and Greenlife Hydropower Ltd corrected around 4% each. Ganapati Microfinance Bittiya Sanstha Ltd, Rairang Hydropower Development Company Ltd and United Idi Mardi RB Hydropower Ltd’s shares also struggled with dips of over 3%. 

Nepse, as per the ARKS technical analysis, formed a bullish candlestick on the daily timeframe. Another breakout of previous high with noteworthy market participation reflect significant investor enthusiasm in the current context. Both Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) reflect intensifying momentum in some of the sectors. Hence, the current uptrend has remained intact with possibility of minor corrections in the coming sessions. 

This column is produced by ARKS Capital Advisors Ltd.

(Views expressed in the article are those of the producer and do not necessarily reflect those of this publication)

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