Daily Market Commentary

Nepse unchanged as market holds ground above 3,100

Published On: August 9, 2021 09:31 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, August 9: The equity index opened Monday’s session in green and tested 3,120 mark early in the morning, from where the market reverted back towards the opening level. After a dip of around 8 points at mid-day, the Nepal Stock Exchange (Nepse) index held ground to trade flat for the remaining trading hours. Nepse ended the day up by modest 1.47 points at 3,109.60.

While energy stocks continued to make new highs, correction in most of the other sectors has kept Nepse’s gain under check. Turnover, meanwhile, has remained upbeat with over Rs. 14 billion worth of equities changing hands.

Sectors ended mixed. Hydropower and Finance sub-indices saw notable strength with both sectors closing more than 3% higher. Life Insurance, Non-Life Insurance and ‘Others’ sub-indices also ended marginally higher. On the other hand, Trading, Investment, Development Bank and Microfinance sub-indices fell more than 1%. All other segments ended marginally in red. 

Arun Valley Hydropower Company Ltd’s shares were traded the most with turnover of Rs. 674 million. Upper Tamakoshi Hydropower Ltd and Api Power Company Ltd posted transactions of Rs. 590 million and Rs. 538 million. Synergy Power Development Ltd, United Modi Hydropower Ltd and National Hydropower Company Ltd were also heavily traded. 

ICFC Finance Ltd, Corporate Development Bank Ltd, Himal Power Partner Ltd, Nepal Hydro Developers Ltd, Union Hydropower Ltd and Jeevan Bikas Laghubitta Bittiya Sanstha Ltd remained locked in the upper circuit limit of 10%. Ngadi Group Power Ltd, Union Life Insurance Company Ltd and other energy stocks saw strength and closed more than 9% higher. 

Karnali Development Bank Ltd and Sarathi Nepal Laghubitta Bittiya Sanstha Ltd were the biggest decliners of the day with losses of 3.89% and 3.37%. Nerude Laghubitta Bikas Bank Ltd, Chandragiri Hills Ltd and First Microfinance Laghubitta Bittiya Sanstha Ltd and Suryodaya Laghubitta Bittiya Sanstha Ltd fell around 3% apiece.

As per the ARKS technical analysis, the index formed a small doji candlestick on the daily timeframe reflecting lack of notable buying and selling pressure. The equilibrium state suggests possibility of consolidation with investors reluctant to take aggressive positions. Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD), reflects loss of momentum of late which also indicates lack of clarity in the equity market. 3,100 level is the immediate psychological support level for the market. 

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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