Daily market commentary

Nepse closes week in red losing 9.92 points

Published On: August 9, 2019 01:30 AM NPT By: Republica


KATHMANDU, Aug 9:  Stocks began trading on Thursday on the feeble note and continued to remain under pressure throughout the session. Following the steady decline, the Nepal Stock Exchange (Nepse) index closed the day 9.92 points lower at 1,238.56 points.

Market activity, however, improved on the last trading day of the week as the local bourse saw a turnover of Rs 454 million on the day compared to Rs 369 million a day earlier.

All the sectors closed the day in the red. Maximum losses came from Hydropower stocks due to the continued decline in share prices of Rasuwagadhi Hydropower Company Ltd and Sanjen Jalavidhyut Company Ltd. The sub-index posted a loss of 2.74% on the day. Subsequently, Non-life Insurance, Microfinance and Hotels sub-indices registered losses of 1.5%, 1.34% and 1.02%, respectively. All other traded sectors logged marginal losses.

Shares of Rasuwagadhi Hydropower Company Ltd and Sanjen Jalavidhyut Company Ltd topped the list of active stocks with shares worth Rs 97 million and Rs 51 million, respectively, changing hands on the day. Nepal Bank Ltd, Nepal Credit and Commerce Bank Ltd, Civil Bank Ltd Promoter Share and Agriculture Development Bank Ltd registered turnovers of Rs 23 million, Rs 19 million, Rs 17 million and Rs 14 million, respectively. Likewise, stocks of Muktinath Bikas Bank Ltd and Prabhu Bank Ltd were also traded actively on the day with turnovers of over Rs 9 million each.

Support Microfinance Bittiya Sanstha Ltd led the list of gainers on the day. The micro lender's share price jumped up by 5.71%. Next on the list were Vijaya Laghubitta Bittiya Sanstha Ltd and Sanima Equity Fund which saw their respective unit prices go up by 4.08% each. Further, Excel Development Bank Ltd, Himalaya Urja Bikas Company Ltd and Sindhu Bikas Bank Ltd posted gains of over 1% each on their share prices. Conversely, Rasuwagadhi Hydropower Company Ltd continued its slide with a loss of nearly 10% in its share price. Likewise, Sanjen Jalavidhyut Company Ltd, Swarojgar Laghubitta Bikas Bank Ltd and Miteri Development Bank Ltd saw their share prices go fall by 4% each. Microfinance stocks continued to dominate the list of losing scrips on the day with as share prices of Summit Laghubitta Bittiya Sanstha Ltd, Samudayik Laghubitta Bittiya Sanstha Ltd and Mithila Laghubitta Bittiya Sanstha Ltd fell by over 3% each.

Among companies publishing their earnings report for the fourth quarter of FY2018/19, Bank of Kathmandu Ltd saw its net profit grow by 46.7% year-on-year to Rs 1.93 billion. On the other hand, the net profit of Chilime Hydropower Company Ltd fell by 22.89% to Rs 715 million from Rs 928 million in the corresponding quarter of the last fiscal year. The drop in net profit has been mainly attributed to increasing in tax liability.

As per ARKS technical analysis, the market formed a bearish candlestick on the day. Likewise, the market failed to hold its ground above 1,240 points. Both Moving Average Convergence Divergence (MACD) and Relative Strength Index (RSI) show weak sentiment prevailing at the current juncture. Hence, if the market fails to recover above the immediate support of 1,240 points, the further downfall is likely.

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