Daily Market Commentary

Nepse ends higher; banking and hydropower stocks gain

Published On: July 25, 2021 08:11 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, July 25: The Nepal Stock Exchange (Nepse) index opened Sunday’s trading on a positive note and traded more than 30 points higher in the morning. Despite a minor pullback in the first hour, stocks continued to see strength in the latter trading hours. A steady rise seen in stocks saw the benchmark post a gain of more than 54 points to close Sunday at 3,058.64.

The equity index climbed for a second straight day marking its maiden close above 3,050 mark. While the market awaits the monetary policy, investors are upbeat on the prospect of decent financial results from the listed companies. Banking stocks are in focus in the current juncture as such stocks are yet to see notable upward move compared to the other sectors of the bourse. Turnover also shot up as over Rs. 14 billion worth of securities changed hands on the day. 

Barring Hotels and Mutual Fund segments, which saw modest declines, all other groups ended in positive territory. Banking segment rallied the most as the respective sub-indices jumped 3.43%. Hydropower sub-index rose 2.39%, while Microfinance sector added 1.57%. All other sectors ended the day firmly higher.

Nepal Bank Ltd and Global IME Bank Ltd were the most heavily traded scrips of the day. Both stocks saw turnovers of almost half a billion rupees each. Nepal Credit and Commerce Bank Ltd, Arun Kabeli Power Ltd and NIC Asia Bank Ltd posted turnovers of Rs. 347 million, Rs. 340 million and Rs. 338 million. United Modi Hydropower Ltd, National Hydropower Company Ltd and Prabhu Bank Ltd were the other top turnover stocks of the day.

Bishal Bazar Company Ltd, Ngadi Group Power Ltd, Support Laghubitta Bittiya Sanstha Ltd, Radhi Bidyut Company Ltd and Panchakanya Mai Hydropower Ltd were the day’s biggest gainers. Each of the scrips jumped 10%. Besides, mainly hydropower stocks saw strength. Kalika Power Company Ltd, Joshi Hydropower Development Company Ltd, Universal Power Company Ltd, Himalaya Urja Bikas Company Ltd and Arun Kabeli Power Ltd were the other major gainers. 

On the other hand, mutual fund sectors corrected the most after a rally for three straight days. Laxmi Unnati Kosh dipped 3.95%, while Kumari Equity Fund shed 3.70%. Oriental Hotels Ltd, Prabhu Select Fund, and other mutual fund units saw declines of over 2% each. 

As per the ARKS technical analysis, the Nepse index formed a strong bullish candlestick on the daily timeframe after a consolidation around 3,000 zone. Hence, a rise with volume suggests bulls in control of the market. Both Moving Average Convergence Divergence (MACD) and Relative Strength Index (RSI) also suggest momentum favoring buyers in the current context. The uptrend will likely stretch with further legs, given the support of 3,000 holds ground. 

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)

Leave A Comment