Daily Market Commentary

Nepse ends lower after banking shares struggle

Published On: July 26, 2021 11:13 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, July 26: After opening more than 16 points higher, a deep correction dragged the benchmark equity index towards negative territory within few minutes of trading. However, the index immediately recouped its earlier losses. The market continued to gyrate on either side of the spectrum for the first trading hour.  Thereafter, the benchmark index remained on the lower side of the spectrum. At the end, the index settled with a minor loss of 8 points at 3050.43.

Investors came to book their profit in the banking scrips after sharp increment for two straight days. However, the index has managed to maintain its footing with strength seen in other sectors. Turnover also remained upbeat with over Rs. 14 billion worth of equities being traded.

Hydropower and Finance sub-indices saw strength and rose 3.35% and 2.57% respectively. Similarly, Trading, Manufacturing & Processing and Microfinace sub-indices posted gains of above 1% each. Sub-indices of Hotels and Tourism, Non-Life insurance and Life Insurance sectors ended trading with a marginal increment. On the other hand, Banking and Mutual Fund segments dipped by 2% and 1.43%, correspondingly. Development Bank, Others and Investment sectors inched marginally lower.

Shares of Ngadi Hydro Power Ltd were traded the most with a turnover of over Rs.393 million. Himalayan Distillery Ltd, NIC Asia Bank Ltd, Agriculture Development Bank Ltd and Nepal Bank Ltd registered transactions of Rs. 335 million, Rs. 334 million, Rs. 328 million and Rs. 323 million respectively. Arun Valley Hydropower Development Company Ltd, Siddhartha Bank Ltd, Global IME Bank Ltd and Nabil Bank Ltd were the other active stocks of the day.

Bishal Bazar Company Ltd, Janaki Finance Ltd, Ridi Hydropower Development Company Ltd, Mountain Hydro Nepal Ltd and Green Life Hydropower Ltd were the gaining scrips for the day which surged 10% each. Himalayan Urja Company Ltd, Ngadi Power Company Ltd, Progressive Finance Ltd, Sanjen Jalavidhyut Company Ltd, Rasuwagadhi Hydropower Company Ltd were the other major gaining stocks for the day.

On contrary, 11% NIC Asia Debenture 82/83, Pokhara Finance Ltd and Sunrise First Mutual Fund came under pressure and dropped by 7.22%, 5.20% and 4.01%, respectively. Sunrise Bank Ltd, Laxmi Bank Ltd, Machhapuchhre Bank Ltd, Citizen Bank International Ltd, Sanima Bank Ltd, NIC Asia Growth Fund and Kumari Equity Fund also closed with declines of over 3% each. 

As per the ARKS technical analysis, the Nepse index formed a small bearish candlestick on the daily timeframe. The index witnessed correction on the back of profit taking seen on banking stocks. The market has held its ground above the 3,000 mark suggesting that bulls are still in control in the current juncture. Technical indicators also reflect short-term uptrend in action of late. Immediate support lies at 3,000 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)

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