DAILY MARKET COMMENTARY

Nepse ends the week in red

October 26, 2018 07:01 AM


KATHMANDU, Oct 26: Weakness prevailed in the stock market throughout the day on Thursday. The benchmark Nepal Stock Exchange (Nepse) index closed 8.82 points lower at 1,241.11 points on the last trading day of the week.

Nepse trimmed all its previous day’s gains with the drop experienced in the day. Hence, range-bound trading has remained intact on the back of indecisiveness among investors and traders. On a positive note, market activity has shown gradual improvement in recent trading sessions. Over Rs 277 million worth of shares were traded on the day.

All major sub-indices, barring the Manufacturing & Processing sub-index, closed the day lower. Hotels sector, which posted significant gains on Wednesday, shed almost 2 percent on the day. ‘Others’ sub-index also fell notably, posting a loss of 1.23 percent. Further, sub-indices of Banking, Hydropower and Non-Life Insurance dropped 0.85 percent, 0.81 percent and 0.7 percent, respectively.

Market participation was dominated by shares by commercial banks. Shares of Prabhu Bank Ltd continued to trade actively as more than Rs 36 million worth of its shares changed hands on Thursday. Similarly, Kumari Bank Ltd was next on the list with Rs 26 million worth of shares traded, followed by NIC Asia Bank Ltd with total turnover of Rs 11 million. Besides, share prices of Siddhartha Bank Ltd, Janata Bank Nepal Ltd and Machhapuchhre Bank Ltd registered turnover of over Rs 9 million each.

Chhyangdi Hydropower Ltd turned in some of the best performances of the day

 its share price went up by 6.25 percent. Similarly, share prices of Kankai Bikas Bank Ltd and Unilever Nepal Ltd increased by over 4 percent each. Share prices of hydropower companies, including Himalayan Power Partner Ltd and Kalika Power Company Ltd, increased by over 3 percent each.

On losing front, major weakness was visible among shares of Barun Hydropower Company Ltd and Rairang Hydropower Development Company Ltd with their respective share prices skidding by 6.4 percent and 5.47 percent. Further, Samata Microfinance Bittiya Sanstha Ltd slid almost 4 percent. Rastriya Beema Company Ltd Promoter Share, Arun Kabeli Power Ltd and Sanima Equity Fund were among other losing securities on the day.

Among the companies publishing their financial report for the first quarter of Fiscal Year 2018/19 on the day, Kanchan Development Bank Ltd and Miteri Development Bank Ltd reported a year-on-year growth in their respective net profit. While the former’s net profit grew by over 19 percent, the latter saw its net profit go up by 10 percent. Similarly, National Microfinance Bittiya Sanstha Ltd has reported a 34.22 percent growth on its net profit in the first quarter of FY2018/19 compared to figures of the same period of last fiscal year.
As per ARKS technical analysis, the index formed a bearish candlestick on the daily timeframe.

Consequently, the index has continued its range bound trading as it has closed between 1,240 and 1,250 points in the last seven sessions. Hence, the market lacks conviction in the present context where a breakout from the current range can suggest a possible direction for the equity market in the short run.


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