Daily market commentary

Nepse up marginally as stocks hold ground

Published On: December 18, 2019 10:57 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Dec 18: Stocks witnessed marginal movements in the initial trading hour on Tuesday with the Nepal Stock Exchange (Nepse) index trading flat at midday. Some volatility was witnessed in the afternoon with the benchmark index swinging between gains and losses. Eventually, Nepse closed the trading session eking out a modest gain of 1.26 points to close at 1,155.37 points. 

Following two sessions of correction, both buyers and sellers remained largely off their desks resulting to a relatively lackluster trading on Tuesday. Market participation also dropped further as total turnover stood at Rs 279 million only. A decline in the broad index in the following sessions might see the market retrace further, while another volume backed rise can make way for another rally.

Trading group was the major gainer of the day as it added 3.02% on its sub-index. Likewise, Development Bank, Hydropower, Non-Life Insurance, Others, Microfinance, Life Insurance and Mutual Fund sub-indices inched higher. On the other hand, Banking, Hotels, Finance and Manufacturing & Processing sectors posted modest loss.

NMB Bank Ltd logged highest turnover in the day with over Rs 34 million worth of the shares traded. Nepal Life insurance Company Ltd, Deprosc Laghubitta Bittiya Sanstha Ltd, Nepal Bank Ltd and NIC Asia Bank Ltd registered turnovers of Rs 15 million, Rs 12 million, Rs 11 million and Rs 10 million, respectively. Salt Trading Corporation, Prabhu Bank Ltd, Nabil Bank Ltd, and Shikhar Insurance Company Ltd were among other active stock of the day.

Nepal Finance Ltd led the list of gainers as its share price went up by 9.68%. Next on the list were Adhikhola Laghubitta Bittiya Sanstha Ltd and Sparsha Laghubitta Bittiya Sanstha Ltd which added 6.92% and 5.03% on their respective share prices. Share prices of Asha Laghubitta Bittiya Sanstha Ltd and Gurans Life Insurance Company Ltd rallied by over 4% each.

Conversely, Dibyashwori Hydropower Ltd and Nepal Seva Laghubitta Bittiya Sanstha Ltd struggled as their respective share prices tanked 6.89% and 5.68%. Hydropower stocks like Ankhu Khola Jalbidhyut Company Ltd and Himalayan Power Partner Ltd were down by 4% each. Mahila Sahayatra Microfinance Bittiya Sanstha Ltd, Khanikhola Hydropower Company Ltd, Joshi Hydropower Company Ltd, and Union Hydropower Ltd were other major losers of the day.

In corporate space, Nabil Bank Ltd is holding its annual general meeting (AGM) on January 7. It has proposed to distribute 22% cash dividend and 12% bonus shares. In other news, Sindhu Bikash Bank Ltd has declared its dividend for FY2018/19. As per its notice to Nepse, the development bank will be distributing 11.51% bonus shares to its shareholders.

ARKS technical analysis indicates the correction easing after two sessions of losses with a small bullish candlestick formation. The candle also depicts indecision witnessed on Tuesday's trading, making movement toward either side possible in the forthcoming sessions. 

Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD), meanwhile, show the market losing momentum slightly. Nonetheless, a volume supported bounce from the current range and breach of previous high of 1,180 points might see the market substantiate the rebound further.

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