Daily Market Commentary

Nepse opens week in red

Published On: February 18, 2019 08:00 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Feb 18: Stocks rallied in the initial trading on Sunday. The Nepal Stock Exchange (Nepse) index rallied almost 10 points initially, only to give up all the gains by mid-session. The benchmark index sank further toward the closing hours to post a loss of 3.15 points. The benchmark index ended the day at 1,109.72 points.

Nepse stretched its losing streak to the fourth day while falling to a new 3-year low. The secondary market has failed to find any significant support in its continuous downfall and is on the verge of hitting 1,100 points. Investors remain cynical on the overall financial outlook driven mainly by credit crisis and high interest rates. Meanwhile, the market has added to its series of dreary sessions with a sub-par turnover of over Rs 210 million.

Majority of sub-indices moved in tandem with the broader market. Trading group was the major drag reflected by a loss of 1.65 percent in its sub-index. The Sub-index of 'Others' sector also slumped more than 1 percent. While Life Insurance and Hydropower sub-indices registered losses of 0.96 percent and 0.74 percent, respectively, sub-indices of Finance, Non-life Insurance, Microfinance, and Banking segments also inched lower. Hotels, Manufacturing & Processing and Development Bank sub-indices also closed slightly higher.

Among active stocks, Prabhu Bank Ltd led the list of companies in terms of transaction amount. The bank's shares worth Rs 19 million changed hands on the day. Similarly, shares of Citizen Investment Trust and Upper Tamakoshi Hydropower Ltd registered turnovers of over Rs 11 million and Rs 10 million, respectively. Besides, Prabhu Bank Ltd Promoter Share, Bank of Kathmandu Ltd and NMB Bank Ltd were the other active companies in the bourse.

Laghubitta Bittiya Sanstha Ltd's scrips further stretched its gaining run with a rally of almost 10 percent. Share price of Excel Development Bank Ltd also surged by more than 5 percent. Panchakanya Mai Hydropower Ltd, meanwhile, saw its share price advance by 3.81 percent. Further, share prices of Mirmire Laghubitta Bittiya Sanstha Ltd, Nabil Equity Fund and Mahila Sahayatra Microfinance Bittiya Sanstha Ltd went up by 2 percent each.

In contrast, significant weakness was visible in shares of Kanchan Development Bank Ltd as its price tanked almost 7 percent. Ridi Hydropower Development Company Ltd also struggled as its share price fell by more than 5 percent. Arun Kabeli Power Ltd, Support Microfinance Bittiya Sanstha Ltd and Ngadi Group Power Ltd followed suit with declines of over 4 percent each.

On the announcement front, Civil Bank Ltd has announced 4 percent cash dividend to its shareholders. The decision is subject to approval of its Annual General Meeting (AGM). In other news, Khanikhola Hydropower Company Ltd published its financials for the second quarter of the current fiscal year, reporting a net loss of over Rs 71 million. Further, shares of Ghalemdi Hydro Ltd opened trading in the secondary market on Sunday. Its price closed at Rs 190 per share.

The benchmark index, as per the ARKS technical analysis, marked another bearish candlestick on the daily timeframe. Momentum indicators also suggest that bearish sentiment remains largely dominant in the market in the present scenario. Immediate support lies at around 1,100-point mark where the index's movement might indicate a possible direction for the equity market in the short run.

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