Daily Market Commentary

Nepse ends week on positive note

Published On: December 14, 2018 08:39 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Dec 14: Stocks trading was lackluster till mid-session on Thursday -- the last trading day of the week. But stocks gained ground later in the afternoon and the benchmark Nepal Stock Exchange (Nepse) closed 7.60 points higher at 1,148.78 points. 

Nepse index continued its recovery after dropping near a 3-year low in the previous week. Nevertheless, investors seemed fairly keen to take long positions in the market at some of the lowest prices. The exchange posted a total turnover of Rs 323 million on the day. 

Despite most of the major sectors pulling back along with the broader market, significant strength remained visible among Non-life Insurance scrips. The group’s sub-index jumped up by 1.31 percent. Microfinance and Banking sub-indices also outperformed the broader market and logged gains of 0.92 percent and 0.85 percent, respectively. Hydropower, Development Bank and Life Insurance stocks also maintained a positive bias on the day with modest advances. Meanwhile, sub-indices of ‘Others’, Hotels and Finance sub-groups closed marginally lower.

Nepal Insurance Company Ltd registered the highest turnover of the day. More than Rs 52 million worth of shares of the insurer changed hands on the day. Nepal Bank Ltd and Machhapuchhre Bank Ltd Promoter Shares were also traded actively with transactions of Rs 22 million and Rs 20 million, respectively. Chhimek Laghubitta Bikas Bank Ltd, NMB Bank Ltd, Nepal Investment Bank Ltd and NIC Asia Bank Ltd were other active scrips in terms of turnover.

Microfinance scrips led the list of advances on the day as share prices of Nagbeli Laghubitta Bikas Bank Ltd and Laxmi Laghubitta Bittiya Sanstha Ltd surged by over 5 percent each. Rairang Hydropower Development Company Ltd and Kabeli Bikas Bank Ltd also posted significant moves to the upside as their respective share prices climbed by over 4 percent each. United Insurance Company Ltd, Civil Bank Ltd and Taragaon Regency Hotel Ltd were among other top gaining scrips on the day. Conversely, share prices of Suryodaya Laghubitta Bittiya Sanstha Ltd and Central Finance Company Ltd came under pressure and shed 3.5 percent each. Similarly, share price of Panchakanya Mai Hydropower Ltd posted fell by 3.33 percent. Mahila Sahayatra Microfinance Bittiya Sanstha Ltd, United Modi Hydropower Ltd, Vijaya Laghubitta Bittiya Sanstha Ltd and Purnima Bikas Bank Ltd followed suit and closed over 2 percent lower each. 

On the announcement front, Kanchan Development Bank Ltd has scheduled its annual general meeting (AGM) for January 5. The meeting is due to approve 5 percent stock dividend and 6.29 percent cash payout to the bank’s shareholders. Similarly, Himalayan Power Partner Ltd will also be convening its AGM on January 13. The hydropower company has not announced any dividend as it is yet to start commercial operations.  

ARKS technical analysis indicates the index forming a bullish candlestick after posting a modest gain in the previous day. The market, hence, has continued to recover some losses after hitting 1,120 points in the previous week. Following the gains, technical indicators also suggest that the momentum is likely to shift slightly towards bulls. However, cautious trading is suggested as the volume remains relatively low to indicate a significant shift from the overall downtrend.

This column is produced by ARKS Capital Advisors Ltd
(Views expressed are those of the producer and do not necessarily reflect those of this publication)

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