KATHMANDU, Nov 30: After opening Monday’s session sharply higher above 2,000 point’s mark, the Nepal Stock Exchange (Nepse) index witnessed a notable correction giving up most of its early gains within the first trading hour. The benchmark witnessed range bound move thereafter gyrating mainly between 1,975 and 2,000 marks for the entire afternoon. At the close, Nepse registered a gain of 28.79 points to end trading at 1,997.06.
After a firmly upbeat trading in the week earlier, Nepse continued its winning streak with back-to-back gains of almost 30 points on Sunday and Monday. Despite some correction seen in banking and development bank stocks, strength seen in other sectors helped the market stay afloat above 1,900 point mark. Discernable enthusiasm persists in the equity market with a daily turnover of almost Rs 8.87 billion.
While most of the segments closed in green, BFIs saw some correction after an earlier rally. Development Bank sub-index retraced 2.08% followed by 1.10% dip in Mutual Fund sector. Finance and Banking sub-indices also sank 0.59% and 0.48%. Life Insurance and Trading sectors were the top performers with the sub-indices rallying 7.34% and 6.61%. The hydropower segment also shot up by 5.93%. All other sub-groups ended the day with moderate gains.
Nepal Life Insurance Company Ltd’s shares led the list of top turnover stocks. The insurer registered a transaction of over Rs 384 million. Nepal Reinsurance Company Ltd followed suit with turnover of Rs 373 million.
Prabhu Bank Ltd and Nepal Bangladesh Bank Ltd posted turnovers of Rs 367 million and Rs 333 million respectively. Global IME Bank Ltd, Nepal Investment Bank Ltd, and Nepal Bank Ltd were also heavily traded on Monday.
United Modi Hydropower Ltd and Upper Tamakoshi Hydropower Ltd’s shares were the biggest percentage gainers on the day. Both scrips hit the upper circuit limit of 10%. Green Development Bank Ltd, Nepal Bangladesh Bank Ltd, Sanjen Jalvidhyut Company Ltd, Rasuwagadhi Hydropower Company Ltd, Nepal Life Insurance Company Ltd, Salt Trading Corporation and Nepal Credit and Commerce Bank Ltd also saw significant buying pressure and closed more than 9% higher.
Bishal Bazar Company Ltd tanked another 10%, while Bottlers Nepal (Terai) Ltd fell 5.42%. Next, Lumbini Bikas Bank Ltd and Garima Bikas Bank Ltd declined 4.10% and 3.79%. Further, Prime Commercial Bank Ltd, Shree Investment Finance Co. Ltd, Nepal SBI Bank Ltd, Mahalaxmi Bikas Bank Ltd and Pokhara Finance Ltd also suffered losses of more than 3%.
As per the ARKS technical analysis, the market formed a spinning top candlestick after closing around the opening level with long wicks towards either side. Hence, some indecision was visible in the day as the market witnessed correction in some of the sectors. However, the market has continued to make fresh highs signaling bulls are yet to lose steam. Nonetheless, with technical indicators signaling overbought readings, some correction can also be expected.
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)