KATHMANDU, August 11: The Nepal Stock Exchange (Nepse) index opened sharply higher, and traded close to 3,200 mark briefly. The index corrected thereafter, and reverted towards the opening level by mid-day. Stocks saw lackluster trading in the afternoon with indecision prevailing in the trading session on Wednesday. At the close, Nepse saw a modest gain of 0.76 points and settled at 3,162.41.

Following a sharp rally in the day earlier, the index saw a small correction after approaching 3,200 mark. With monetary policy still on the cards, investors lack notable conviction with sectors turning in mixed performance. Turnover also remained upbeat with Rs. 15 billion worth of shares being traded on Wednesday.

Sectors ended mixed with Hydropower and Hotels & Tourism sub-indices rallying 3.91% and 2.78%. Non-Life Insurance, Microfinance, Life Insurance and Manufacturing & Processing stocks inched marginally higher. On the other hand, Trading sub-groups tumbled 1.37%. Investment, Development Bank and Finance sectors fell almost 1% apiece. All other sectors ended marginally in negative territory.

Shares of Upper Tamakoshi Hydropower Ltd continued to trade actively with a turnover of Rs. 683 million. Arun Valley Hydropower Development Company Ltd, Arun Kabeli Power Ltd, Api Power Company Ltd and ICFC Finance Ltd registered turnovers of over Rs. half a billion each. Hydroelectricity Investment & Development Company Ltd, Ridi Hydropower Development Company Ltd, Nepal Bank Ltd and First Microfinance Laghubitta Bittiya Sanstha Ltd were among other top turnover stocks.

ICFC Finance Ltd, Ridi Hydropower Development Company Ltd, Ru Ru Jalbidhyut Pariyojana Ltd, Jeevan Bikas Laghubitta Bittiya Sanstha Ltd and Union Life Insurance Company Ltd shot up by exactly 10% each. NRN Infrastructure & Development Ltd, Arun Kabeli Power Ltd, Nepal Hydro Developers Ltd, Rairang Hydropower Development Company Ltd and CEDB Hydropower Development Company Ltd were among other major gainers.

Janaki Finance Ltd, on the other hand, came under significant pressure and tanked 4.17%. Hydroelectricity Investment & Development Company Ltd, Gurkhas Finance Ltd, Best Finance Company Ltd, Excel Development Bank Ltd and Green Development Bank Ltd tumbled around 3% apiece. Mainly other finance and microfinance stocks saw declines on the day.

As per the ARKS technical analysis, the index formed a small shooting star candlestick, suggesting sellers taking control in the current context. The index tested resistance at 3,200 and pulled back thereafter. Momentum indicators also reflect slight loss of momentum, making a consolidation or correction likely. A dip below 3,100 mark can see the index make further correction, while a breakout above 3,200 will point towards extension of the uptrend further.

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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