KATHMANDU: Local came under considerable pressure on Sunday. After losing around 14 points in the morning session, the Nepal Stock Exchange (Nepse) index recouped some of its losses by mid-session. However, dragged by a sustained bearish pressure, the major average witnessed a steady decline in the latter trading hours. At the close, the benchmark index was down 20.79 points at 1,276.68 points.
With the notable slide, the index has stretched its losing streak for three consecutive sessions. Following heavy profit booking in the prior sessions, the index has dropped by more than 60 points after reaching its yearly high in the same day last week. Hence, investors are taking extreme caution in the present context refraining from taking any major long positions. The bourse continued to record active market participation as almost Rs 1 billion worth of shares were traded on the day.
All sectors saw correction on the back of Sunday's broad selling. Non-life Insurance sub-index corrected the most and tanked 2.79%. Trading sub-index also struggled and shed 2.11%. Hotels, Hydropower, and Life Insurance sub-indices, meanwhile, registered losses of 1.99%, 1.88% and 1.73%, respectively. Market heavyweight Banking sub-index also closed 1.62% lower on the day. All other sub-indices ended the day in red.
Deprosc Laghubitta Bittiya Sanstha Ltd was the most active scrip of the bank as with Rs 82 million worth of shares traded. Next on the list were Nepal Life Insurance Company Ltd and Global IME Bank Ltd with turnovers of at least Rs. 62 million each. Shivam Cements Ltd, NIC Asia Bank Ltd and Prabhu Bank Ltd followed suit with turnovers of around Rs 30 million each. Other Life Insurance scrips were also traded heavily on the day.
Among gainers, Joshi Hydropower Development Company Ltd outperformed the overall index as its share price added 3.17%. NIBL Pragati Fund mutual fund units also added almost 3%. NMB Microfinance Bittiya Sanstha Ltd also posted a gain of 2.71%. Furthermore, share prices of Khanikhola Hydropower Co Ltd, Progressive Finance Ltd and Swarojgar Laghubitta Bikas Bank Ltd rose over 1% each.
On the other hand, Janaki Finance Ltd turned in the worst performance of the day losing over 8% on its share price. Share prices of Mithila Laghubitta Bittiya Sanstha Ltd and Ridi Hydropower Development Company Ltd tanked over 7% each. Saptakoshi Development Bank Ltd saw its share price tumbled 6.80%, while Non-life Insurance scrips like United Insurance Company Ltd and Everest Insurance Company Ltd posted losses of around 5% each.
Sanima Bank Ltd published its financials for the second quarter on Sunday. As per its earnings report, the bank reported a 16% year-on-year increase in its net profit to Rs 1,147 million.
On ARKS technical front, the market formed a bearish candlestick on the daily timeframe extending its slump below 1,300 points. Technical indicators also suggest that bears are in control at the current juncture. Immediate support of the market lies at 1,150 points where a rebound can present a buying opportunity. In contrast, breach of the support might suggest possibility of further 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)