Daily Market Commentary

Nepse takes a breather as stocks hold ground

Published On: September 1, 2021 08:00 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, September 1: The local bourse registered an upbeat start to Wednesday’s session with the index climbing more than 35 points in the first few minutes of trading. However, the index saw sharp decline bringing the market in the negative territory within the first hour. Another recovery pushed the index around 45 points higher, but further correction in the latter hours pulled the index towards the opening level with Nepse ending a modest 1.18 point up at 2,977.02.

After a firm sell-off of more than 200 points in 6 days, bearish pressure eased slightly with buyers negating sellers in the session. Besides, turnover also remained in the lower side of the spectrum as a result of passive buying and selling in the equity market. With the recent corrections, most of the sectors are on the lower side of the last couple of months’ trading range. Turnover stood below Rs. 10 billion for the first time in the past 30 days.

Sectors ended mixed. Hotels and Tourism Index saw strength with the respective sub-index adding 3.76%. Trading, Banking, Life Insurance and Investment sub-indices also ended marginally in the green. Finance sub-index slumped 2.86% followed by Development Bank group which dipped 0.74%. Hydropower segment fell 0.57%. All remaining segments suffered marginal dips.

Arun Valley Hydropower Development Company Ltd registered the highest turnover of almost Rs. 699 million. United Modi Hydropower Ltd and Api Power Company Ltd posted turnovers of Rs. 301 million and Rs. 237 million. Himalayan Distillery Ltd, Ridi Hydropower Development Company Ltd and Nepal Bank Ltd were among other actively traded stocks.

On the gainers’ front, Ru Ru Jalbidhyut Pariyojana Ltd shot up by 7.55%. Oriental Hotels Ltd, United Modi Hydropower Ltd and Himalaya Urja Bikas Company Ltd shot up by over 6% apiece. Soaltee Hotel Ltd, Life Insurance Corporation Nepal and Manakamana Smart Laghubitta Bittiya Sanstha Ltd were among other top gainers.

On the other hand, Sunrise First Mutual fund fell to hit the lower circuit level of 10%. Khani Khola Hydropower Co. Ltd, Guheshwori Merchant Bank & Finance Co. Ltd and Corporate Development Bank Ltd posted declines of 7.77%, 6.27% and 5.75%. Other finance stocks followed suit.

The equity index formed a doji candlestick on the daily timeframe reflecting indecision in the current scenario. Besides, with dipping volumes, the market will likely stretch its consolidation around 2,950 mark. Immediate support lies at psychological 2,900 mark. Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) indicates momentum favoring sellers in the current context. 

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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