KATHMANDU, Oct 29:  The equity market extended Wednesday’s gains in Thursday’s initial session of the trading. After opening around 15 points higher, the Nepal Stock Exchange (Nepse) index saw a sharp correction pulling the index in the negative territory briefly. Despite another surge at mid-day, the index saw another decline in the final trading hours with the index closing slightly below its opening level. Nepse ended the day down 1.78 points at 1,645.68.

The recent rally lost some steam as traders looked to book profit in the last trading day of the week. The stock market successfully breached its February high of 1,632 points in the previous trading session. However, some correction was evident after five straight days of gains. Market participation also remained upbeat with over Rs 3 billion worth of shares traded on the day.

Trading sector led the gains as the group’s sub-index jumped 1.37%. ‘Others’ sector rose 0.55%, while Non-Life Insurance, Microfinance and Hydropower segments closed around 0.5% higher each. Life Insurance segment also inched marginally in the green. On the other hand, Manufacturing & Processing sub-index fell 1.13% and Mutual Fund sub-index dropped 0.93%. Hotels, Development Bank, Banking and Finance sub-indices suffered modest losses in Thursday’s trading.

Among actives, commercial bank scrips were heavily traded on the day. Prime Commercial Bank Ltd and Prabhu Bank Ltd saw turnovers of Rs 138 million and Rs 136 million, respectively. NMB Bank Ltd, Global IME Bank Ltd and NIC Asia Bank Ltd followed suit with transactions of over Rs 123 million, Rs 121 million and Rs 118 million. Further, over Rs 101 million worth of Shiva Shree Hydropower Ltd’s shares were traded on its first day of trading.

Shiva Shree Hydropower Ltd and Nepal Finance Ltd saw the biggest percentage gains. Both scrips remained locked in the upper circuit of positive 10%. Mithila Laghubitta Bittiya Sanstha Ltd and Dibyashwori Hydropower Ltd, meanwhile, rose over 5% each. Himalaya Urja Bikas Company Ltd and Mountain Hydro Nepal Ltd also saw strength and ended over 4% higher.

Meanwhile, shares of Sindhu Bikash Bank Ltd and Shree Investment Finance Co. Ltd saw considerable weakness with losses of over 3% each. United Modi Hydro Ltd fell 2.98% and Kumari Bank Ltd closed 2.85% lower. Laxmi Bank Ltd, NIBL Pragati Fund and General Insurance Company Ltd also saw losses of over 2% each.

As per the ARKS technical analysis, the market formed a small bearish candlestick with Thursday’s modest correction. The retracement was also triggered by profit booking after the index gathered around 100 points in five straight sessions. Despite some more correction likely, the overall uptrend has remained intact with momentum favoring the bulls. While cautious approach should be taken in the current scenario, further rise backed by notable volumes can see the index approach 1,700 points 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)

www.arkscapitaladvisors.com

 
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