Daily market commentary

Nepse continues gaining streak

Published On: December 6, 2019 10:16 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU: The Nepal Stock Exchange (Nepse) index witnessed a sharp rally at the beginning of trading on Thursday. The benchmark index climbed to intraday high of 1,135 points, but pulled back slightly by mid-session. However, the index recovered in the final hour to close the day 7.45 points higher at 1131.92 points.

With the market falling to some of the lowest levels, investors have begun gathering shares at cheaper prices contributing to a steady growth for a third straight day. The total turnover has also shown improvement with Rs 358 million worth of securities traded on the day.

Most of the trading groups, except Manufacturing & Processing, posted gains on the day. Trading, Life Insurance, Non-life Insurance, Microfinance and Mutual Fund sub-indices posted gains of 3.76%, 2.93%, 1.77%, 1.61%, and 1.21%, respectively. Similarly, Hotels, Hydropower, Others, Development Bank, Finance and Banking sub-indices also eked out minor gains.

Nepal Life Insurance Company Ltd was the most active stock of the day as Rs 35 million worth of its shares changed hands on the day. Next on the list was NMB Bank Ltd with turnover of Rs 22 million. Swabalamban Laghubitta Bittiya Sanstha Ltd and Nepal Bank Ltd recorded turnover of over Rs 12 million each, while Himalayan Distillery Ltd and Samudayik Laghubitta Bittiya Sanstha Ltd saw Rs 11 million worth of shares traded each.

Among advances, Summit Laghubitta Bittiya Sanstha Ltd saw its share prices go up by 7.78%, while shares of Ganapati Laghubitta Bittiya Sanstha Ltd and Samudayik Laghubitta Bittiya Sanstha Ltd ended 6.88% and 6.77% higher, respectively. Likewise, Nabil Equity fund, Gurans Life Insurance Company Ltd, Salt Trading Corporation, Civil Laghubitta Bittiya Sanstha Ltd, Premier Insurance Company Ltd and Ridi Hydropower Development Company Ltd added at least 5% each on their respective share prices.

On the other hand, share price of Dibyashwori Hydropower Ltd fell by 7.01%. Similarly, Barun Hydropower Company Ltd, Mahuli Samudayik Laghubitta Bittiya Sanstha Ltd, Mahila Sahayatra Microfinance Bittiya Sanstha Ltd, Sidhu Bikas Bank Ltd, and Bottlers Nepal Terai Ltd saw their share prices go down by 3% each.

On announcement front, Jyoti Bikas Bank Ltd has proposed to distribute 12.75% bonus shares to its shareholders from profits earned in FY2018/19. The proposal is subject to approval of the Nepal Rastra Bank and the development bank’s annual general meeting (AGM).

ARKS technical analysis shows that the market formed a third bullish candlestick on the daily timeframe. It indicates that the buyers have remained active in the recent sessions overcoming the sellers. Technical indicators like Moving Average Convergence Divergence (MACD) and Relative Strength Index (RSI) are also tilted upward, indicating the market gathering momentum. However, a breach of 1,150 points – the immediate resistance – with significant volume will only validate the rebound further.

This column is produced by ARKS Capital Advisors Ltd
(Views expressed are those of the producer and do not necessarily reflect those of this publication)

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