Daily market commentary

Nepse ends week with 14-point gain

Published On: March 20, 2020 10:45 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU: A sharp slide saw the Nepal Stock Exchange (Nepse) index lose more than 30 points in the first 10 minutes of trading on Thursday. However, the benchmark index witnessed a steady recovery thereafter, trimming all its morning losses by mid-session. With buyers slowly gaining control, the major average managed to close the day 13.50 points higher at 1,269.30.

The easing off of selling momentum was evident on Wednesday’s trading as losses continued to shrink. Further, with sellers finally losing steam, the index managed to take a breather providing some respite to the investors. Despite the index cutting week’s losses on the final trading day, the index still stands over 100 points lower compared to previous week. Turnover also improved reflecting the index’s movement. Almost Rs 2 billion worth of securities were traded on the day.

Meanwhile, sectors witnessed mixed performance on the day. Most of the gains came from Life Insurance stocks with the group’s sub-index adding over 2%. Non-life Insurance and Banking sub-indices followed suit with gains of 1.49% and 1.23%, respectively. Microfinance, Hydropower and ‘Others’ segments were also up by around 1% each. On the other hand, Finance sub-index suffered the most and fell by 1.02%. Hotels, Development Bank, Trading and Manufacturing & Processing sectors also closed the day in red.

Himalayan Distillery Ltd was the most active scrip of the day. Over Rs 313 million worth of shares of the beverage producer changed hands on the day. Next on the list was Nepal Life Insurance Company Ltd with Rs 113 million worth of shares traded. NIC Asia Bank Ltd, NMB Bank Ltd and Nepal Bank Ltd were the other active scrips with transactions of Rs 96 million, Rs 72 million and Rs 49 million, respectively.

Two companies remained locked in the upper trading limit of 10% as respective share prices of Janautthan Samudayik Laghubitta Bittiya Sanstha and Radhi Bidyut Company Ltd rallied by 9.96% and 9.55%. Further, Nepal Credit and Commerce Bank Ltd, Karnali Development Bank Ltd and Mountain Hydro Nepal Ltd saw their respective share prices surge by over 6%.

Conversely, Central Finance Co Ltd turned in the worst performance of the day as its share price tanked almost 10%. Similarly, Saptakoshi Development Bank Ltd struggled and saw its share price fall by 8%. Shree Investment Finance Co Ltd, Nepal Hydro Developers Ltd and Manjushree Finance Ltd were the other decliners shedding over 6% each.

In the news, Securities Board of Nepal (Sebon) has received a proposal for 200% rights issue of Samriddhi Finance Company Ltd. The board will now scrutinize the proposal to raise capital before giving final approval to the ‘C’ class financial institution to go ahead with the issue.

On technical front, according to ARKS, the market has found some footing with the formation of a small bullish candlestick. Relative Strength Index (RSI) indicates the selling momentum subsiding slightly, but the possibility of a major rebound is yet to be seen. Moving Average Convergence Divergence (MACD) line, meanwhile, suggests that the short-term downtrend is still in action. Immediate support of the market can be taken at 1,200-1,220 points range. Breach of this support will make a slide toward 1,170 points likely, whereas a bounce back can see the index test its resistance at 1,335 points. 

Leave A Comment