Daily Market Commentary

Nepse kicks off week in green fueled by investor enthusiasm

Published On: May 2, 2021 10:00 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, May 3: The stock market opened Sunday’s trading in green before a small correction pulled the Nepal Stock Exchange (Nepse) index towards opening level. However, stocks saw strength in the latter trading hours. The benchmark traded around 30 points higher at mid-day, with a subsequent rally pushing the index further up at the close. Nepse ended Sunday’s trading at 2,665.11.

After a sharp decline in the latter part of April, the index has extended its upward movement recouping more than 150 points in four trading days. With prohibitory orders in action and most of the economic activities coming almost to a halt, participation in the equity market remained high. Turnover, consequently, jumped on day-to-day basis. The bourse registered a transaction of Rs. 7.36 billionagainst Rs. 4.36 billion in the session earlier.

All sectors ended in green led by ‘Others’ segment as its sub-index jumped 4.61%. Life Insurance, Hotels and Tourism and Non-Life Insurance segments also witnessed considerable strength and rallied over 3% each. Manufacturing & Processing, Trading and Microfinance sub-indices followed suit with gains of over 2% each.

Three companies remained locked in the upper circuit limit of positive 10%. Bishal Bazar Company Ltd, Mahila Laghubitta Bittiya Sanstha Ltd and Singati Hydro Energy Ltd rallied over 9% each. Sanima General Insurance Ltd, Synergy Power Development Ltd and Universal Power Company Ltd registered gains of 8.7%, 7.14% and 7.1%. Janaki Finance Ltd, Asha Laghubitta Bittiya Sanstha Ltd and Shikhar Insurance Company Ltd were among other major gainers of the day.

Everest Bank Ltd Convertible Preference Share, on the other hand, suffered the most. The share price dropped 2%. Sunrise First Mutual Fund and NIBL Samriddhi Fund 1 fell 1.42% and 1.32%, respectively. Nepal Hydro Developers Ltd, Narayani Development Bank Ltd and Goodwill Finance Ltd also suffered losses of over 1% each.

In terms of ARKS technical analysis, the index formed a strong bullish candlestick on the daily timeframe stretching its rebound from 2,500 mark. A momentous breach of 2,600 mark suggests that bulls are in notable control in the present context. The medium term uptrend has also remained intact with the formation of a higher low at 2,500 line with the previous low at 2,400 mark. Immediate support of the market lies at 2,600.

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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