Daily market commentary

Nepse snaps 3-day losing run

Published On: August 28, 2019 08:30 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Aug 28: The Nepalese stock market witnessed strength since the beginning of Tuesday's trading hour with the Nepal Stock Exchange (Nepse) index adding almost 9 points in the afternoon.

Following a slight selling pressure towards the session's close, the index gave up some of its earlier gains but managed to close the day in green. The benchmark index registered a gain of 4.87 points to settle at 1,208 points.

With the day's gain the index has partially recouped its previous day losses. In the meantime, Nepse has held ground above 1,200 points level as selling pressure seem relatively subdued.

Most of the scrips are at some of their lowest levels where investors are less likely to offload their investments. Market participation also remains on the lower side of the spectrum. Less than Rs 250 million worth of securities changed hands on Tuesday.

Strength was visible among most of the traded sectors. Losses came only from Hotels and Non-Life Insurance sectors. Meanwhile, sub-indices of Finance, Hydropower and Microfinance led the list of advances and climbed 0.89 percent, 0.79 percent and 0.66 percent, respectively. Banking stocks also witnessed some improvement with the group's sub-index adding 0.48 percent. Besides, all other sectors edged marginally higher.

Among actives, shares of NIC Asia Bank Ltd posted the maximum turnover of Rs 23 million. Nepal Bank Ltd and Prabhu Bank Ltd followed suit with turnovers of Rs 15 million and Rs 10 million, respectively. Mahalaxmi Bikas Bank Ltd saw transactions worth Rs 8 million.

Citizen Bank International Ltd's shares were also actively traded after the commercial bank proposed 12 percent cash dividend and 3 percent bonus shares to its shareholders becoming the first commercial bank to declare dividend for the Fiscal Year 2018/19.

On the gainers front, recently listed Sabaiko Laghubitta Bittiya Sanstha Ltd and Adhikhola Laghubitta Bittiya Sanstha turned in the best performances of the day. Both shares rallied to hit the upper circuit of 10 percent. Progressive Finance Ltd also surged over 8 percent.

Shares of Sindhu Bikash Bank Ltd shot up by 6 percent, while those of Samata Microfinance Bittiya Sanstha Ltd and Dibyashwori Hydropower Ltd jumped over 5 percent each.

Worst loss in the day came from City Express Finance Co Ltd as it saw its share price tank almost 7 percent. Next, Arun Kabeli Power Ltd tumbled 3.77 percent. Other losing securities include Excel Development Bank Ltd, Union Hydropower Ltd and Citizens Mutual Fund-1 which dropped over 3 percent each.

On the corporate space, Summit Laghubitta Bittiya Sanstha Ltd declared 21.09 percent stock dividend to its shareholders for the Fiscal Year 2018/19. The microfinance's share closed the day's trading at Rs 555 with a modest gain of 0.36 percent

ARKS technical analysis indicates the market forming a bullish candlestick on the daily timeframe after three straight days of decline. On a positive note, the support at around 1,200 points has firmly held ground in the recent sessions.

Technical indicators also indicate selling pressure losing steam of late. Hence, a significant rebound accompanied by improved volumes in the coming sessions will substantiate the reversal further.

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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