Nepal Stock Exchange rebounds after index dips to 1,100 points

Published On: February 26, 2019 07:32 AM NPT

KATHMANDU: The local bourse experienced some pressure initially as the Nepal Stock Exchange (Nepse) index posted modest decline in the beginning trading hour on Monday.

The index dropped below 1,100 points mark briefly in the afternoon. Nonetheless, a last-hour rise in the day's session saw the index climb to 1,109.73 points – up 7.41 points compared to the day earlier. 

The index posted a rebound from around 1,100 points mark for a second time in a week. With the day's advance, the index also erased some of Sunday's losses. Nonetheless, traded volume remains unsupportive for any significant reversal to follow. The market registered a total turnover of Rs 204 million on the day.

Most of the sectors followed the broader market, barring finance sub-group. Finance sub-index dipped a modest 0.11 percent. 

Among groups witnessing strength, 'Others' sub-index posted the biggest gain of 1.52 percent. Insurance stocks followed suit as Non-Life Insurance and Life Insurance sub-indices jumped 1.37 percent and 1.08 percent, respectively. 

Manufacturing & Processing sub-index, similarly, closed 1 percent higher. Market bellwether banking scrips also inched higher with the group's sub-index adding 0.43 percent on Monday. 

Ordinary and promoter shares of Nabil Bank Ltd were the most actively traded scrips on the day. The respective stocks posted turnovers of Rs 25 million and Rs 14 million. The company is closing its shareholders' book on Tuesday for the purpose of convening its Annual General Meeting (AGM). Distribution of 10 percent bonus shares and 22 percent cash dividend is among its key agendas. Next, shares of Upper Tamakoshi Hydropower Ltd registered total transaction of over Rs 7 million followed by Asian Life Insurance Company Ltd, NMB Bank Ltd and NIC Asia Bank Ltd with turnovers of over Rs 6 million each. 

Among advances, Ankhu Khola Jalavidhyut Company Ltd turned in the best performance in the session and rallied 6.49 percent. Similarly, shares of Prudential Insurance Company Ltd surged 5.86 percent, while that of Neco Insurance Company Ltd jumped 4.80 percent. 

Himalayan Distillery Ltd, NLG Insurance Company Ltd and Himalayan Power Partner Ltd were the other gaining scrips with advances of over 3 percent apiece. 

Shares of Sahayogi Bikas Bank Ltd, on the other hand, struggled and tanked almost 9 percent in the session. Global IME Sammunat Scheme – 1 also tumbled 5.62 percent. Shares of National Hydropower Company Ltd and Mithila Laghubitta Bittiya Sanstha witnessed losses of over 3 percent each. Goodwill Finance Company Ltd and Excel Development Bank Ltd followed suit. 

On the earnings front, Nadep Laghubitta Bittiya Sanstha Ltd published its second quarterly financials of FY18/19. The microfinance reported a 53 percent year-on-year decline in its net profit to Rs 14.27 million. The drop in its earnings is largely attributed to significant rise in its provision for possible losses. 

As per the ARKS technical analysis, the market formed a bullish candlestick as the index attempted a second rebound from 1,102 points mark. Nonetheless, the sentiment remains fairly bearish with momentum indicators trending on the lower side of the spectrum. Hence, long positions can only be taken if the equity index posts a marked breakout above immediate resistance of 1,125 points.


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