Daily market commentary

Nepse falls slightly snapping 8-day winning run

Published On: January 19, 2021 05:57 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Jan 19: The local stock market’s benchmark opened the day in positive territory. However, profit booking in the early trading hour pulled the Nepal Stock Exchange (Nepse) index towards red at mid-day where the index fell around 30 points. A recovery in the latter hours saw the index recoup most of its earlier losses. Nepse ended the day with a modest 5.57 point’s decline at 2,326.90.

The retracement came as sellers slightly outweighed buyers as traders resorted to profit booking in banking, insurance and other stocks. Consequently, Nepse ended in red for the first time in 9 sessions. However, market participation increased on the day. Over Rs. 7.47 billion worth of shares were traded on Tuesday.

Most of the sectors corrected, while Finance, Life Insurance and Trading sub-indices closed higher. The respective sub-indices advanced 3.57%, 3.55% and 1.35%. In contrast, ‘Others’, Hotels and Non-Life Insurance sub-indices fell over 1% each. Development Bank group also dropped 1%. All other segments fell marginally.

Shares of Nepal Life Insurance Company Ltd were traded the most with a notable turnover of Rs. 920 million. Prabhu Bank Ltd, Nepal Reinsurance Company Ltd and Nepal Telecom Ltd followed suit with turnovers of RS. 356 million, Rs. 306 million and Rs. 290 million. Hydroelectricity Investment & Development Company Ltd, NIC Asia Bank Ltd and Himalayan Distillery Ltd were among other actively traded stocks.

Finance companies led the list of top gainers. Progressive Finance Ltd, Nepal Finance Ltd and Gurkhas Finance Ltd shot up by exactly 10%. Corporate Development Bank Ltd, Narayani Development Bank Ltd and Janaki Finance Ltd also jumped almost 10%. Prabhu Life Insurance, Nepal Life Insurance Company Ltd, Goodwill Finance Ltd and Civil Laghubitta Bittiya Sanstha Ltd were the other major gainers.

On the other hand, Support Microfinance Bittiya Sanstha Ltd tanked 7.74% followed by Chhyangdi Hydropower Ltd, which fell 5%. Himal Dolakha Hydropower Company Ltd and Gurans Laghubitta Bittiya Sanstha Ltd closed 3.82% lower. Panchakanya Mai Hydropower Ltd, RMDC Laghubitta Bittiya Sanstha Ltd and Shine Development Bank Ltd tumbled around 3% apiece.

As per the ARKS technical analysis, the equity market formed a small bearish candlestick indicating possibility of some correction in the sessions ahead. Therefore, 2,300 mark must be closely watched, a break below which will point towards possibility of further retracement. Nonetheless, strong support can be taken as 2,250. Given the market holds ground above the aforementioned level, the uptrend will remain intact.

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)


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