Daily Market Commentary

Nepse down 76 points to end near 2,800 mark

Published On: September 16, 2021 07:23 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Sept 16: The equity index saw a sharp dip since the beginning of Thursday’s trading session. The index was down by almost 70 points within the first trading hour as a result of notable selling pressure. Selling momentum subsided slightly in the latter trading hours but the bourse failed to make any significant recovery. Nepse, subsequently, ended the last trading day of the week at 2,812.39 – down 76.65 points against the session earlier.

Stocks have continued to take serious hit with interest rates being the major factor in driving investor sentiment down. Thursday’s fall was also accompanied by an increase in volume. Daily turnover rose to Rs. 9 billion compared to around Rs. 5 billion in the past couple of sessions.

All sectors closed lower with Finance and Hydropower segments suffering the most. Both indices tumbled more than 4% each. Development Bank, Hotels & Tourism, Trading and Microfinance sub-indices lost over 3%. All other segments ended in negative territory. Heavyweight banks closed 2.11% lower.

Energy stocks were actively traded. Arun Valley Hydropower Company Ltd led the list of top turnover scrips with a turnover of Rs. 386 million. Ridi Hydropower Development Company Ltd, Api Power Company Ltd and United Modi Hydropower Ltd were the other actives with turnovers of Rs. 284 million, Rs. 256 million and Rs. 230 million. Himalayan Distillery Ltd, Nepal Bank Ltd and ICFC Finance Ltd followed suit.

Only two stocks managed to close the day in green. Manakamana Smart Laghubitta Bittiya Sanstha Ltd continued its post listing rally with another 10%-gain. Rastriya Beema Company Ltd inched 0.02% higher.

Corporate Development Bank Ltd was the day’s biggest loser as the development bank stock tanked 8.17%. Next, Shree Investment & Finance Co. Ltd and ICFC Finance Ltd dropped 7.18% and 7.03%. Liberty Energy Company Ltd, Chandragiri Hills Ltd and Goodwill Finance Ltd’s shares also came under pressure with each scrip closing more than 6% lower.

As per the ARKS technical analysis, the index formed a strong bearish candlestick reflecting continuation of the recent downward move. While, momentum favors sellers in the current juncture, the index’s close around a strong support level might see the index make a rebound. Momentum indicators also indicate weakness in the equity market. The equity index’s reaction at 2,800 level can help investors gauge Nepse’s possible direction

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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