Daily market commentary

Nepse closes higher after volatile trading session

Published On: April 4, 2019 03:00 AM NPT

KATHMANDU, April 4: Stocks began trading on a positive note stretching previous day's surge. The Nepal Stock Exchange (Nepse) index turned red briefly in the morning but traded higher for most of the remaining session. After reaching 1,172 points at mid-day, the benchmark index pulled back slightly to close the day at 1,165.84 points -- up 2.01 points against previous day's close.

Investors continued to trade with optimism as Nepse showed some sign of recovery with demand seen mainly among heavyweight banking scrips. However, after an advance of about 30 points in eight days, the bourse also witnessed some selling pressure in the afternoon. Market activity further improved as shares worth more than Rs 546 changed hands on Wednesday.

Despite an advance in the broad based index, most of the sectors closed the day in red. Only Banking and Development Bank sub-indices closed the day in green with gains of 0.44 percent and 0.42 percent, respectively. Hotels sub-index saw the biggest loss of 0.89 percent among others. Further, Hydropower, Finance and Manufacturing & Processing sub-indices declined 0.34 percent, 0.33 percent and 0.25 percent, respectively. Besides, all other traded sub-groups edged lower.

Banking stocks also witnessed heavy trading in the day led by NIC Asia Bank Ltd and Nepal Credit and Commercial Bank Ltd. The respective stocks saw turnovers of over Rs 44 million and Rs 42 million.

Nepal Bank Ltd, NMB Bank Ltd and Prime Commercial Bank Ltd were also actively traded with total transactions of Rs 29 million, Rs. 21 million and Rs. 19 million, respectively. Other commercial banks followed suit.

Among advances, shares of Nepal Insurance Company Ltd registered the highest percentage gain of 4.64 percent followed by Kankai Bikas Bank Ltd which shot up by 4.13 percent. Laxmi Equity Fund also saw considerable strength as its unit price rose 3.88 percent. Swadeshi Laghubitta Bittiya Sanstha Ltd, Shangrila Development Bank Ltd and Shine Resunga Development Bank Ltd were among other top gaining scrips.

In contrast, shares of Universal Power Company Ltd tanked for 8 straight days. After a loss of almost 10 percent on Wednesday's session, its price has now dipped to Rs 119 per share from the opening level of Rs 300 per share.

Weakness was also visible in shares of Sindhu Bikash Bank Ltd and Ghalemdi Hydro Ltd as both scrips suffered a loss of over 4 percent each. Further, Himalayan Power Partner Ltd, Bhargav Bikash Bank Ltd, NIBL Samriddhi Fund-1 and Support Microfinance Bittiya Sanstha Ltd declined over 3 percent apiece.

On the corporate front, Century Commercial Bank Ltd has called for its Annual General Meeting (AGM) on April 25 and is closing its shareholders' book from April 12. Approval of 2 percent bonus shares and 4.50 percent cash dividend is among its key agendas for the meeting.

Similarly, Shivam Cements Ltd will be holding its Annual General Meeting (AGM) on April 22 with book closure date set at April 9. The meeting is also due to endorse 15.79 percent cash dividend to its shareholders.

As per the ARKS technical analysis, the market formed a spinning top candlestick as both buyers and sellers remained active in the session indicating some indecision in the equity market. Meanwhile, technical indicators suggest that bullish sentiment is still prevalent in the current scenario. The market has also breached its previous high of 1,163 points; another close above this level might see uptrend continuation in the forthcoming sessions.

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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