KATHMANDU, Feb 23: The equity market came under significant selling pressure and dropped around 50 points in the morning before staging a small rebound. However, the stock market continued to struggle in the afternoon with the Nepal Stock Exchange (Nepse) index dropping as much as 90 points. A recovery in the final closing hours saw the benchmark end Tuesday’s session with a 21.16 point’s decline at 2,586.51.
With the supreme court’s verdict due on parliament dissolution this week, investors have taken a step back from taking major buying positions. Consequently, sellers prevailed on the day. Nonetheless, turnover has remained upbeat. Over RS. 8.56 billion worth of shares changed hands on the day.
‘Others’ sector fell the most as Nepal Infrastructure Bank Ltd fell to hit the lower circuit. The sub-index dropped 2.36%. Manufacturing & Processing, Hotels, Mutual Fund and Development Bank sub-indices also dropped more than 1%. All other sectors saw selling pressure and closed in the red. Only Trading sub-index ended the day in green.
Nepal Infrastructure Development Bank and Upper Tamakoshi Hydropower Ltd were traded the most with turnovers of Rs. 739 million and Rs. 434 million. Nabil Bank Ltd and NIC Asia Bank Ltd followed suit with turnovers of Rs. 373 million and Rs. 328 million. Global IME Bank Ltd, Neco Insurance Co. Ltd and Nepal Life Insurance Company Ltd were among other active stocks.
Nepal Finance Ltd, Api Power Company Ltd, Liberty Energy Company Ltd and Himal Power Partner Ltd were the day’s major winners as each scrip hit the upper circuit limit of 10%. NLG Insurance Company Ltd, Chandragiri Hills Ltd and Unnati Sahakarya Laghubitta Bittiya Sanstha Ltd also rallied over 5% each. Other hydropower stocks also saw strength.
On the other hand, Nepal Infrastructure Bank Ltd corrected sharply with a 10% slump. Ankhu Khola Jalvidhyut Company Ltd also suffered with a 6.67% drop. Unilever Nepal Ltd and NMB50 also tanked by over 5%. Panchakanya Mai Hydropower Ltd, Corporate Development Bank Ltd and Khani Khola Hydropower Company Ltd were among other major decliners with losses of around 4% each.
In terms of ARKS technical analysis, the market formed a hammer candlestick on the daily timeframe. Despite formation of a bearish candlestick, the long wick on the lower side suggests that buyers were able to push the prices higher from the intraday low at around 2,520 mark. Though uncertainty still prevails in the equity market, a follow up green candlestick can suggest buildup of buying momentum.
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)