Daily Market Commentary

Nepse ends 8 points lower

Published On: January 17, 2019 04:30 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Jan 16: The secondary market opened on a positive note and added almost 5 points in early trading on Wednesday. The Nepal Stock Exchange (Nepse) index then fluctuated between gains and losses to eventually end the day in red. Nepse ended the day 7.57 points lower at 1,187.97 points.

After witnessing two straight advancing sessions, the benchmark index came under slight pressure on the day and pared some of its gains from the earlier session. However, the bourse witnessed a relatively active turnover in the day. More than Rs 530 million worth of securities changed hands on Wednesday.

Most of the major sub-indices posted moves to the downside following the broader market index. Hydropower sub-index, pushed by shares of Upper Tamakoshi Hydropower Ltd which has continued its surge since its opening trading day, rose 1.8 percent. Sub-indices of Trading and Manufacturing & Processing stocks also edged higher. On the other hand, Non-Life Insurance scrips struggled reflected by a drop of almost 2 percent in its respective sub-index. 'Others', Life Insurance and Microfinance scrips followed suit with the respective sub-indices shedding over 1 percent each. Banking, Finance and Development Bank sub-indices also posted modest losses in the session.

In terms of market participation, Nepal Bank Ltd posted the highest turnover of over Rs 88 million followed by Citizens Investment Trust which registered shares transaction of over Rs 65 million. Further, Machhapuchhre Bank Ltd Promoter Share, NIC Asia Bank Ltd and Machhapuchhre Bank Ltd registered turnovers of Rs 34 million, Rs 31 million and Rs 25 million, respectively.

Upper Tamakoshi Hydropower Ltd led the list of gainers as its share price surged by almost 10 percent to Rs 283 per share. Share price of Nepal Hydro Developers Ltd rallied 9.38 percent in the session. Additionally, Mahuli Samudayik Laghubitta Bittiya Sanstha Ltd and Shangrila Development Bank Ltd posted gains of over 6 percent and over 5 percent, respectively. Share prices of City Express Finance Co Ltd and Shree Ram Sugar Mills Ltd also went up by 4 percent each.

In contrast, shares of NMB Microfinance Bittiya Sanstha Ltd tumbled 7.5 percent after the micro sector lender reported a 43 percent year-on-year decline in its net profit as per earnings report for the second quarter of Fiscal Year 2018/19. Mission Development Bank Ltd also logged worst performance of the day with its share price going down by 6 percent. Butwal Power Company Ltd, Central Finance Co Ltd and Himalayan Power Partner Ltd were among companies losing over 4 percent each.

On the earnings front, NIC Asia Bank Ltd published its earnings report for the second quarter of FY2018/19. The bank's net profit grew by more than 160 percent year-on-year to Rs 1,511 million.

ARKS technical analysis indicates the market forming a bearish candlestick after two days of gains. However, the overall sentiment still appears fairly neutral as the index has traded in a limited range since the beginning of January. Technical indicators also suggest that the market is lacking a clear direction. Hence, cautious trading is suggested at the current juncture.

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