Daily market commentary

Nepse extends gains, closes firmly above 1,300 points

Published On: May 15, 2019 11:03 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU: Stocks made a steady advance in the first half of Tuesday's session as the benchmark Nepal Stock Exchange (Nepse) index briefly went above 1,320 points. The benchmark index, however, retraced slightly thereafter to close the day 14.12 points higher at 1,315.45 points.

Nepse added to its previous day gains to close in the green for three straight days. However, the index is still trending in the consolidation range of 1,280-1,320 points, suggesting some indecision still prevailing despite the recent surge. On a positive note, the day's advance was also accompanied by active market participation as the local bourse posted turnover of over Rs 1 billion.

The index was buoyed by strength seen in all the traded sectors except Trading segment. Manufacturing & Processing sub-index witnessed the biggest gain and shot up by 3.34 percent mainly due to gains coming from Shivam Cements Ltd. Similarly, Non-life Insurance sub-index jumped up by 2.47 percent. Banking sub-index closed 1.22 percent higher, while Mutual Fund sub-index gained 0.94 percent. All other sub-indices closed the day in green.

Nepal Bank Ltd was the most actively traded stock of the day as more than Rs 103 million worth of its shares changed hands. Next, Shivam Cements Ltd and Agriculture Development Bank Ltd logged in turnover of over Rs 84 million and Rs 78 million, respectively. Nepal Credit and Commercial Bank Ltd, Prime Commercial Bank Ltd and Upper Tamakoshi Hydropower Ltd were among other active stocks of the day.

Among gainers, both ordinary and promoter shares of Rastriya Beema Company Ltd hit the positive circuit of 10 percent on Tuesday. Similarly, share price of Shivam Cements Ltd increased by 9.86 percent. Furthermore, share prices of Bhargav Bikas Bank Ltd, Agriculture Development Bank Ltd and Corporate Development Bank Ltd closed higher by 8.15 percent, 7.77 percent and 7.14 percent, respectively.

However, Laghubitta Bittiya Sanstha Ltd was the worst performing stock in the session with a loss of 7.55 percent. Share price of Joshi Hydropower Development Company Ltd was down by 5 percent, while Support Microfinance Bittiya Sanstha Ltd and Global IME Sammunat Scheme–1 saw their unit prices fall by 3.7 percent each. Other losing securities include Summit Microfinance Development Bank Ltd, Mountain Hydro Nepal Ltd and Kalika Laghubitta Bittiya Sanstha Ltd.

On announcement front, Siddhartha Insurance Ltd has declared 15.48 percent bonus shares to its shareholders from its earnings of FY2017/18. After capitalization of the shares, the insurer will meet the minimum capital requirement of Rs 1 billion. In other news, Mirmire Laghubitta Bittiya Sanstha Ltd, Nagbeli Laghubitta Bikas Bank Ltd and Kisan Microfinance Bittiya Sanstha Ltd have signed an agreement to undergo merger.

Among major companies publishing their financials for the third quarter of the current fiscal year, Nepal Telecom Ltd reported a 15 percent year-on-year decline in its net profit following a slump in its income from services. Meanwhile, earnings of Soaltee Hotel Ltd increased by 52 percent compared to its earnings in the corresponding quarter previous year.

As per the ARKS technical analysis, the market formed a bullish candlestick for third straight day. In the meantime, the market tested its resistance of 1,320-point mark and pulled back slightly in the afternoon. Hence, a breach of 1,320 points in the coming sessions with supportive volume might see Nepse make another move to the upside.

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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