Daily market commentary

Nepse continues sluggish run

Published On: August 15, 2019 04:30 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Aug 15: After trading flat initially, the Nepal Stock Exchange (Nepse) index came under pressure in the latter trading session on Wednesday. A steady decline after midday saw the benchmark index close the day 5.17 points lower at 1225.90 points.

With Wednesday's loss, the index has witnessed decline for five straight sessions. Investors still remain cautious about the possible movement of the Nepse index. Likewise, the turnover remained low as only Rs 257 million worth of shares were traded on the day.

Most of the sectors closed the day in red. Only Microfinance sub-index eked out marginal gains. Maximum losses came from Trading, Hydropower and Hotels sub-indices with their respective index falling by 0.67%, 0.65% and 0.6%, respectively. Subsequently, Banking, Mutual Fund and Life Insurance sub-indices logged marginal losses on the day.

Nepal Bank Ltd led the list of active stocks with turnover Rs 21 million. Rasuwagadhi Hydropower Company Ltd, Nepal Credit & Commercial Bank Ltd and Prabhu Bank Ltd were next on the list with transactions worth Rs 15 million, Rs 11 million and Rs 10 million, respectively.

Nepal Credit & Commercial Bank Ltd posted a growth of 13.81% in its net profit year-on-year in fourth quarter of FY2018/19. The bank's net profit stands at Rs 1.52 billion. Sanjen Jalabidhyut Company Ltd, Nabil Bank Ltd and NIC Asia Bank Ltd Shares were also actively traded with turnover of over Rs 9 million each. On Wednesday, Nabil Bank Ltd also published its financials for the fourth quarter of FY2018/19, logging net profit growth of 7.84 percent to Rs 4.29 billion.

In terms of gainers, share prices of Vijaya Laghubitta Bittiya Sanstha Ltd led the list as its share price rose 4.26%. Similarly, NLG Insurance Company Ltd, Ghalemdi Hydro Ltd, Himalaya Urja Bikas Bank Ltd, Miteri Development Bank Ltd and Nabil Equity Fund rallied by over 2% each.

On the other hand, share prices of World Merchant Banking & Finance Ltd and Support Microfinance Bittiya Sanstha Ltd fell by 5.3% and 3.6%, respectively. Share prices of Goodwill Finance Ltd, Sunrise Bank Ltd, and Nepal Seva Laghubitta Bittiya Sanstha Ltd were also down by over 2% each.

Among companies publishing financials for the fourth quarter of FY2018/19, Standard Chartered Bank Ltd and Mega Bank Ltd reported year-on-year net profit growth of 13.95% and 30.51%, respectively. Their net profit stands at Rs 2.49 billion and Rs 1.71 billion.

ARKS technical analysis indicates the market forming a fifth bearish candlestick as bears have remained slightly dominant in the market. Similarly, low market activity and all technical indicators suggest weak momentum in the market with the index lacking significant conviction at the current juncture. Immediate support now lies at 1,200-point level where the index's movement will be key in determining plausible direction of the equity market.

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