KATHMANDU, July 20: Stocks fell sharply over the first trading hour of Thursday's session. Despite staging a partial comeback mid-session, the benchmark Nepal Stock Exchange (Nepse) index continued its downfall toward the end. At the close, the index stood at 1,193.39 points – a drop of 5.38 points, or 0.45 percent, compared to Wednesday.
Investors have continued to put forth muted enthusiasm in the recent trading days. Further, lack of any major developments on the economic front has been contributing to a gradual decline in the market of late despite the bourse turning in a relatively large turnover of Rs 561 million. Over 50 percent of the total turnover accounted for transactions of promoters shares of Prime Life Insurance Company Ltd alone.
In terms of sectoral performance, weakness was visible in most of the trading segments. Only Hotels and Manufacturing & Processing sub-Indices ended the day higher. Non-life insurance stocks turned in a weak performance with its sub-index declining by 1.34 percent. Sub-indices of Microfinance and Insurance also fell by 1.03 percent and 0.72 percent, respectively.
Prime Life Insurance Company Ltd Promoter Share registered a turnover of Rs 305 million on Thursday. Next on the list was Nabil Bank Ltd as Rs 33 million worth of its shares changed hands on the day. Other active stocks on the day were Nepal Insurance Company Ltd, Prabhu Insurance Ltd and Arun Valley Hydropower Development Company Ltd which logged transactions of Rs 26 million, Rs 13 million and Rs 10 million, respectively.
NIC Asia Growth Fund led the list of advancing securities as it gained over 4.03 percent on its unit price. Next on the list were Karnali Development Bank Ltd and Nepal Community Development Bank Ltd which saw their share prices surge by 2.83 percent and 2.46 percent, respectively. Additionally, stocks of Pokhara Finance Ltd, Jyoti Bikas Bank Ltd and Soaltee Hotels Ltd also ended the day in green.
On the other hand, Nepal Insurance Company Ltd recorded the worst performance of the session as its price fell by 5.79 percent to a three-month low of Rs 569 per share. Share price of National Hydropower Company Ltd also fell 5.61 percent seeing a surge in the preceding session. Stocks of Synergy Power Development Ltd and Bhargav Bikas Bank Ltd followed suit, losing 5 percent each.
In corporate space, Shivam Cement Ltd is launching Initial Public Offering (IPO) to float 880,000 units of shares to locals from July 29 to August 27. The issue is priced at Rs 300 per share including a premium of Rs 200 on its face value.
ARKS technical analysis model indicates stock market posting losses for a third consecutive session with a small bearish candlestick formation. Hence, the index is still to show any significant move to either side as it has been trending near the 1,200-point level for more than a week. Further, lack of momentum is clearly being portrayed by Relative Strength Index (RSI) and Moving Average Convergence/Divergence (MACD) as lackluster trading continues.
This column is produced by ARKS Capital Advisors Ltd www.arkscapitaladvisors.com
(Views expressed are those of the producer and do not necessarily reflect those of this publication)