KATHMANDU, Aug 14: The sole equity market of Nepal turned in a choppy session for the first half of Monday's trading session with the Nepal Stock Exchange (Nepse) index trending along the unchanged line of 1,164 points. However, the benchmark index picked up momentum in the latter hours to gain 10.43 points to close the day's trading at 1,174.37 points.
After shedding almost 30 points in the last seven sessions, the index made a partial recovery on Monday. Though the index surged by more than 10 points, market activity declined by over 32 percent compared to Sunday. Only Rs 169 million worth of shares were traded in the bourse amid low investor confidence in the equity market.
All major sub-indices followed the broader market, barring the Hotels sub-index which closed 0.14 percent lower. Life Insurance stocks, which have been under pressure for the past few sessions, witnessed significant strength. Its sub-index added almost 2 percent on Monday. Next on the list was Non-life Insurance sub-index which climbed 1.34 percent. Sub-indices of Microfinance and Development Banks groups gained over 1 percent each, while banking segment closed the day 0.76 percent higher.
Nepal Life Insurance Company Ltd continued to lead the list of active stock as more than Rs 12 million worth of the company's shares changed hands. Stocks of most of the commercial banks were actively traded on the day. Shares of Everest Bank Ltd posted a turnover of Rs 6.56 million. Similarly, Nabil Bank Ltd, Prime Commercial Bank Ltd, Nepal Investment Bank Ltd and Mega Bank Ltd logged turnovers of over Rs 4 million each.
In terms of advances, Arambha Microfinance Bittiya Sanstha Ltd posted the best performance on Monday as its share price rose over 9 percent. Furthermore, Green Development Bank Ltd and Best Finance Company Ltd went up by more than 6 percent each. Mahila Sahayatra Microfinance Bittiya Sanstha Ltd also closed 5.81 percent higher.
Conversely, share price of Support Microfinance Bittiya Sanstha Ltd continued to nosedive for third straight day, shedding almost 10 percent. Multipurpose Finance Company Ltd also tumbled for four days on the trot. The finance company's share price fell by almost 9 percent. Other losing stocks include, Nepal Community Development Bank Ltd, Tinau Development Bank Ltd and Everest Bank Ltd Convertible Preference Share.
Among the commercial banks publishing their earnings report for the fourth quarter of Fiscal Year 2017/18 on Monday, Nepal SBI bank Ltd reported a 19.93 percent growth in its net profit while Machhapuchhre Bank Ltd presented a decline of almost 7 percent in its earnings. Meanwhile, Nepal Telecom Ltd presented a modest year-on-year growth in its net profit amounting to Rs. 15.67 billion.
As per the ARKS technical analysis, the index retraced slightly and gained 10 points after hitting a two-year low in the previous session. Despite the surge, the index is still trading below the consolidation range of 1,180-1,200 points. Hence, a change in the direction to an uptrend is yet to be observed. Consequently, long positions can only be taken if the index crosses above its consolidation zone with noteworthy market activity.
This column is produced by ARKS Capital Advisors Ltd www.arkscapitaladvisors.com
(Views expressed are those of the producer and do not necessarily reflect those of this publication)