Daily market commentary

Nepse loses 18 points after two-day rally

Published On: September 20, 2019 08:50 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU: The stock market Stock Exchange (Nepse) witnessed correction on Thursday, capping a two-day rally. The Nepal Stock Exchange (Nepse) lost more than 9 points in the first trading hour. Though the benchmark index managed to recover some gains in the mid-session, it couldn’t sustain for long. Eventually, the Nepse index closed 18.12 points lower at 1,155.3 points on the week’s last trading day.

With the day’s loss, the market activity stood at only Rs 399 million, down by 16.13% compared to the session earlier.

Most of the sectors ended the day in red. Only Trading and Mutual Fund sub-indices eked out marginal gains. On the other hand, ‘Other’, Hotels, Non-life Insurance and Life Insurance sub-indices were down by 2.78%, 2.5%, 2.34% and 2.02%, respectively. Similarly, Banking, Hydropower and Manufacturing & Processing sub-indices followed the market, dropping over 1% each. All other sectors saw marginal losses.

Shivam Cements Ltd and Prabhu Bank Ltd led the listed companies in terms of share transactions with turnovers of Rs 52 million and Rs 26 million, respectively. Siddhartha Bank Ltd, National Microfinance Bittiya Sanstha Ltd and Nepal Bank Ltd were next on the list with transactions worth Rs 18 million, Rs 17 million and Rs 16 million, respectively. Similarly, shares of Nepal Life Insurance Company Ltd and Citizen worth Rs 15 million each were traded on the day.

Among gainers, share prices of Samata Microfinance Bittiya Sanstha Ltd hit the upper circuit of 10% for the second consecutive day. Excel Development Bank Ltd also added 7.22% on its share price. Stocks of National Microfinance Bittiya Sanstha Ltd and Aankhu Khola Jalabidhyut Company Ltd also posted gains of over 5% each. National Microfinance Bittiya Sanstha Ltd has proposed 75% bonus shares and 5% cash dividend from the profit of FY2018/19. The decision is subject to approval of the Nepal Rastra Bank (NRB) and the micro-lender’s upcoming Annual General Meeting (AGM). Likewise, unit prices of Nabil Equity Fund and Manjushree Finance were up by over 3% each.

In contrast, Gurans Laghubitta Bittiya Sanstha Ltd and Sparsha Laghubitta Bittiya Sanstha Ltd were the worst performers of the day as their share prices tanked over 8% each. Nepal Insurance Company Ltd and Surya Life Insurance Company Ltd fell also saw their respective share prices go down by 7.21% and 6.1%. Stock prices of Arun Kabeli Power Ltd and Ganapati Microfinance Bittiya Sanstha Ltd were also down by over 5% each.

In corporate space, Unnati Microfinance Bittiya Sanstha Ltd has announced 38.63% bonus shares and 2.03% cash dividend to its shareholders from the earnings of FY2018/19. The decision is subject to approval of the central bank and the company’s annual general meeting.

As per ARKS technical analysis, the market formed a bearish candlestick on Thursday partially erasing previous day gains. The loss can be taken as a slight retracement following steep rally in the previous sessions. Further, the Relative Strength Index (RSI) has rebounded from the oversold territory. Moving Average Convergence Divergence (MACD) line is also on the verge of forming a bullish crossover indicating bulls taking over. Hence, the outlook remains upbeat despite Thursday’s decline.

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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