Daily Market Commentary

Nepse ends slightly higher after 3-day losing streak

Published On: November 28, 2018 09:18 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Nov 28: Following the sustained sell-off in the previous sessions, the benchmark Nepal Stock Exchange (Nepse) index took off with a positive start on Tuesday. The advance in the beginning hours saw the Nepse index recoup all of the previous day's losses adding more than 6 points by mid-session. However, the equity market gave up its initial gains to settle the session with a marginal gain of 1.61 points at 1,161.43 points. 

After the market hit a 52-week low on Monday, the index retraced slightly in the session. However, financial woes still continue amid lack of optimistic news regarding current interest rates. Meanwhile, market participation remained subdued with the bourse posting a total transaction of over Rs 231 million.

The modest movement of the index can be attributed to major sectoral indices closing in either side of the spectrum. Among the gaining segments, Hotels sub-index posted the biggest gain of 0.56 percent. Sub-index of Hydropower stocks also added 0.4 percent. 'Others', Development Bank and Banking sub-indices also edged higher. In contrast, Non-Life Insurance stocks came under pressure and shed 0.53 percent. 

Finance, Life Insurance, Microfinance and Manufacturing & Processing sub-indices also posted marginal losses in the session. 

Market participation remained in favor of commercial banks with shares of NMB Bank Ltd posting the highest turnover of Rs 19 million. 

Further, Nepal Bank Ltd and Nepal Credit & Commerce Bank Ltd registered turnovers of Rs. 10 million apiece. Similarly, Sanima Bank Ltd, Muktinath Bikas Bank Ltd and Prabhu Bank Ltd registered daily turnovers of Rs 8 million, each. 

Tuesday's gainers list was led by Suryodaya Laghubitta Bittiya Sanstha Ltd as it saw its share price rally 8.37 percent. National Hydro Developers Ltd also jumped 6.43 percent on the day followed by Kalika Laghubitta Bittiya Sanstha Ltd which added 5.75 percent. 

Besides, Api Power Company Ltd and Summit Microfinance Development Bank Ltd registered gains of over 4 percent each. 

Conversely, NLG Insurance Company Ltd fell the most and lost 4 percent on Tuesday. 

Next on the list of decliners, Swarojgar Laghubitta Bikas Bank Ltd tumbled 3.77 percent. Correspondingly, Tinau Bikas Bank Ltd, Nirdhan Utthan Laghubitta Bittiya Sanstha Ltd and Reliance Finance Ltd sank over 3 percent each. 

In the news, Mahuli Samudayik Laghubitta Bittiya Sanstha Ltd has opened its issuance of 50 percent right shares from Tuesday. The micro-sector lender will be accepting applications for the respective issue till December 2. 

Meanwhile, Kisan Microfinance Bittiya Sanstha Ltd has called for its annual general meeting (AGM) on December 21 with endorsement of 29 percent bonus shares as one of its key agendas. The company will be close its shareholders book on December 15 for the respective meeting. 

As per the ARKS technical analysis, the overall sentiment still appears significantly bearish despite the index easing off slightly on Tuesday. Technical indicators, including Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD), also suggest that the market is yet to see a significant shift in momentum. Hence, investor are suggested to trade on a cautious note in the present context.

This column is produced by ARKS Capital Advisors Ltd www.arkscapitaladvisors.com

(Views expressed are those of the producer and do not necessarily reflect those of this publication)

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