KATHMANDU, June 8: The stock market witnessed a lackluster trading session on the last trading day of the week. Stocks failed to hold on to the previous day's gains which came on the back of the government withdrawing the new capital gain calculation method.
Skepticism among investors seems far from over as the reversion to older CGT calculation system is temporary. It will only hold place until the committee led by an undersecretary of the Ministry of Finance presents a detailed study report with recommendations on CGT calculation formula.
The Nepal Stock Exchange (Nepse) index fell sharply during the first hour of the day's trading and declined gradually in the latter phase. At the close, the index stood 25.68 points lower at 1,257.07 points. The equity market witnessed a total turnover of Rs. 468 million on Thursday.
All major sub-indices slipped into red on Thursday. Significant weakness was visible in the Insurance sector with the Insurance Sub-index declining by 2.64 percent. Similarly, sub-indices of Hydropower, Microfinance and Hotels sub-group shed over 2 percent each.
Shares of Mega Bank Ltd recorded the highest turnover of the day. Over Rs 20 million worth of the bank's shares changed hands on Thursday. Second on the list was Nepal Investment Bank Ltd with total turnover of more than Rs 19 million. Shangrila Development Bank (Promoter Share), Nepal Life Insurance Company Ltd and Civil Bank Ltd were the other active stocks on the day.
In terms of advances, Samata Microfinance Bittiya Sanstha Ltd witnessed its share price rise highest by 3.96 percent. Further, share prices of Arun Valley Hydropower Development Company Ltd and Ridi Hydropower Development Company also went up by 3.07 percent and 2.40 percent, respectively.
In contrast, Nagbeli Laghubitta Bikas Bank Ltd was the worst performer for the day as its share price plunged 7.66 percent. Mahila Sahayatra Microfinance Bittiya Sanstha also saw its share price go down by 5.62 percent. Other top losing stocks on the day include Garima Bikas Bank Ltd, Unnati Finance Ltd and Nerude Laghubitta Bikas Bank Ltd.
In news, shares of Nepal Seva Laghubitta Bittiya Sanstha have been listed on Nepse for trading. Trading will commence on June 12. The company had issued 600,000 units of primary shares through an initial public offering (IPO) in April.
As per the ARKS technical analysis, a bearish candlestick is formed on daily timeframe, wiping out all the previous day's gains. With the day's decline, the index has also hit a 2-month low. If the downfall continues, the index can be expected to test its psychological support which lies at around 1,200-point mark.
Further, Relative Strength Index (RSI) is sloping towards the oversold zone and Moving Average Convergence/ Divergence (MACD) is also sliding downward in the negative territory. Hence, both indicators suggest that bears are in control of the market in the present context.