Daily Market Commentary

Nepse ends the week in red

Published On: December 28, 2018 03:00 AM NPT By: Republica

KATHMANDU, Dec 28: Significant strength carried over from Wednesday to initial trading of the last trading day of the week. The benchmark equity index surged sharply in the first trading hour on Thursday to cross 1,230 points mark. The index then stayed over the 1,230 points level briefly, before giving up its initial gains later in the afternoon. At the close, Nepse posted a marginal loss of 1.08 points to settle at 1,215.16 points.

The index retraced slightly after stocks posted significant move to the upside on Wednesday. Most of the stocks pulled back from their intraday highs on the back of profit booking by short term investors. Meanwhile, the local exchange witnessed a significant improvement in market activity as the total turnover crossed Rs. 1 billion mark after 3 months.

Most of the major sub-indices turned red on the day following the last hour drop in the broader market. Life Insurance stocks bucked the trend as the group's sub-index jumped 2.78 percent. Similarly, sub-indices of 'Others' and 'Manufacturing & Processing' scrips also ended the day in green.

Hotels stocks, on the other hand, came under substantial pressure as reflected by a 3.57 percent drop in its sub-index. Trading sub-index followed with a decline of more than 1.23 percent. Further, Non-Life Insurance and Banking sub-indices shed 0.83 percent and 0.63 percent, respectively. Besides, all other sectors posted modest losses in the session.

Nepal Life Insurance Company Ltd, whose share price has rallied more than 25 percent in December, witnessed the biggest turnover of over Rs. 148 million on the day. Next, more than Rs. 82 million worth of shares of Nepal Bank Ltd changed hands. Additionally, Global IME Bank Ltd and National Life Insurance Company Ltd registered turnovers of Rs. 53 million and Rs. 43 million, respectively. Global IME Bank Ltd is closing its shareholders' book on Friday for the purpose of convening its Annual general Meeting (AGM) which is due to approve 16 percent bonus shares to the bank's shareholders.

Among the advances, Citizens Investment Trust added to its rally as its share price surged 9 percent on Thursday. Next on the list of gainers, Mahila Sahayatra Microfinance Bittiya Sanstha Ltd climbed more than 8 percent followed by Himalayan Distillery Ltd which added 6 percent. Additionally, Samata Microfinance Bittiya Sanstha Ltd and Nepal Life Insurance Company Ltd registered gains of 5 percent each.

In contrast, mutual fund unit of Siddhartha Equity Oriented Scheme turned in the worst performance on the day as its price tumbled over 6 percent. Sunrise Bank Ltd's stocks also struggled and declined 5.48 percent. Furthermore, Nepal Seva Laghubitta Bittiya Sanstha Ltd, Grameen Bikas Laghubitta Bittiya Sanstha Ltd and Soaltee Hotel Ltd posted losses of over 4 percent each.

On the announcement front, Goodwill Finance Ltd declared dividend from its earnings of fiscal year 17/18. The company will be distributing 5.26 percent cash dividend after approval from its AGM.

AS per the ARKS technical analysis, the market formed a small bearish candlestick on the day as the equity market witnessed slight correction. The overall sentiment still seems fairly bullish at present. Further, the buying momentum is yet to ease off as suggested by technical indicators. Meanwhile, immediate support for the market lies at psychological 1,200 points level.

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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