KATHMANDU, Aug 31: After a positive start to Monday’s session, the local bourse traded firmly in green for the entire trading hours. The Nepal Stock Exchange (Nepse) index hovered 10 points higher for the first trading hour. Stocks saw further strength after mid-day and witnessed a steady climb with Nepse trading over 30 points higher in the afternoon. Following a brief correction at the close, the major average ended the day at 1,484.99 – up 22.31 points against the session earlier.
While prohibitory orders are still in order in the valley and many other districts, the equity market has continued to see massive enthusiasm. Compared to the day earlier, trading volume more than doubled to Rs. 3.46 billion on Monday. Supply of fresh investments into the equity market has been attributed towards keeping the index afloat despite slowed down business and economic activities.
Many sectors closed the day with substantial gains. ‘Others’ sub-index shot up by 4.12 % as Nepal Reinsurance Company Ltd extended its rally further. Next, Hydropower, Non-Life Insurance and Manufacturing & Processing segments rallied over 3% each. Life Insurance and Trading sector also saw notable upswing and registered gains of more than 2 %. All other sectors ended the day with moderate gains, while only the Hotels sector inched marginally lower.
Shares of Nepal Reinsurance Company Ltd has continued to lead the list of actives. Over Rs. 287 million worth of the reinsurer’s shares changed hands. Neco Insurance Company Ltd and Nepal Life Insurance Company Ltd followed suit with turnovers of Rs. 178 million and Rs. 168 million. Manufacturing shares Shivam Cements Ltd and Himalayan Distillery Ltd, meanwhile, registered turnovers of over Rs. 150 million. Surya Life Insurance Company Ltd, National Life Insurance Company Ltd and NIC Asia Bank Ltd were among other top turnover scrips.
Nepse ends higher after mid-March consolidation
Investors continued to take heavy buying positions in shares of Nepal Reinsurance Company Ltd pushing the respective price 10 % higher on Monday. Unnati Sahakarya Laghubitta Bittiya Sanstha Ltd also remained locked in the upper circuit for a second consecutive day. NRN Infrastructure and Development Ltd, Synergy Power Development Ltd, Arun Kabeli Power Ltd, Rairang Hydropower Development Company Ltd, Panchthar Power Company Ltd and Union Hydropower Ltd also posted gains of over 9 % each.
On the losing front, Himal Dolakha Hydropower Company Ltd suffered with the day’s biggest loss of 7.29 %. Ghodighoda Laghubitta Bittiya Sanstha Ltd’s shares also came under pressure and tumbled 4.58 %. Oriental Hotels Ltd fell 3.72 %. Other major decliners include Miteri Development Bank Ltd, Guheshwori Merchant Bank & Finance Co. Ltd, Sindhu Bikash Bank Ltd and Jyoti Bikas Bank Ltd, which closed more than 2 % lower on Monday.
On the day, Panchthar Power Company Ltd published its fourth quarter earnings of fiscal year 19/20. As per the financials, the energy company reported a net profit of Rs. 84 million compared to a net loss of Rs. 120 million in the previous year. Its per share earnings stands at Rs. 8.74.
ARKS technical analysis indicates the index forming a firm bullish candlestick on the daily timeframe supported by heavy volume. With the day’s advance the equity index breached its resistance at the 1,270-1,280 points mark suggesting momentum heavily shifted towards buyers. Hence, the aforementioned level can act as a new support. Technical indicators also reflect significant optimism in the stock market of late. Further rally can see the index test another resistance at around 1,550 points mark.
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)
www.arkscapitaladvisors.com
