The market failed to pick up this week mainly due to high selling pressure reflecting investors´ loss of confidence towards the market. The total turnover decreased by 21.17 percent compared to last week. [break]
The ´Others´ sector (-3.40 percent) posted the highest loss this week with Nepal Telecom Co (-Rs 15) dropping values considerably. The Commercial Banking sector (-2.70 percent) continued its downfall as post book closure prices of Bank of Kathmandu (-Rs 88) along with Machhapuchhre Bank (-Rs 24) and Standard Chartered Bank (-Rs 120) depreciated. The Development Banking sector (-2.53 percent) followed as share prices of City Development Bank (-Rs.61), Business Development Bank (-Rs.32) and Gurkha Development Bank (-Rs 44) slumped throughout the week. Likewise, the Finance Sector (-1.88 percent) also fell with drop in share prices of Butwal Finance (-Rs 145) and Royal Merchant Banking & Finance (-Rs 45). Similarly, Lumbini General Insurance (-Rs 21) pulled the Insurance sector down (-0.04 percent) marginally, despite gains in share prices of United Insurance (+Rs 8) and Nepal Life Insurance Co (+Rs 14). Meanwhile, the Hydro Power sector (+0.84 percent) gained points during the week with Butwal Power Company (+Rs 16) and Chilime Hydro Power Co (+Rs 15) gaining value.
Amongst news and highlights, Commerz and Trust Bank of Nepal, Nepal´s 29th commercial bank, is to start operation by September 20. Also, Nepse and CMC of Tata consultancy that is developing the CDS software for Nepse has signed a MOU to provide the CDS software within 4 months.
On the declaration front, Sanima Bikash Bank and Unilever Nepal have declared 10 percent and 560 percent cash dividend respectively. Similarly, NMB Bank declared 10 percent bonus shares and dividend for the fiscal year. Nabil Bank is holding its 26th AGM on October 11 for which it is closing its book on September 27. The bank will propose to give 40 percent bonus shares and 30 percent cash dividend for the fiscal year. Furthermore, Nirdhan Utthan Bank is closing its book on September 24 to issue 2:1 right shares. Likewise, Royal Merchant Banking & Finance is closing its books on September 10 to issue 1:1 right shares.
Forecast:
Technical analysis indicators signal the continuation of the current downtrend; however a downward retracement can be expected with the market gaining points as book closures of key banks approach in the coming week.
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