Daily market commentary

Stocks close firmly higher stretching New Year gains

Published On: April 17, 2019 08:49 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU: Stocks opened Tuesday's trading on a poised note and climbed above 1,190 points mark in the beginning hour. The Nepal Stocks Exchange (Nepse) index continued to see strength in the remaining trading hours and witnessed a surge mid-session that pushed the benchmark index over the crucial 1,200-point mark. Further rally toward the end saw the index close the day 23.33 points higher at 1,212.05 points.

Optimism has remained in the secondary market since the index rebounded from 1,100-point mark earlier in March. The index has posted gains of over 100 points in a span of one and half months. The broad rally on Tuesday was also supported by noteworthy turnover as over Rs 742 million worth of shares changed hands.

All traded sectors closed the day in green as heavyweight banking stocks continue to post gains. The sub-index of Banking segment jumped up by 2.78 percent, followed by Microfinance scrips whose sub-index was logged gains of 2.49 percent. Finance and Development Bank sub-indices also registered gains of 1.74 percent and 1.35 percent, respectively. Life Insurance sub-index closed 1.34 percent higher. Besides, all other sub-indices edged higher on the day.

Banking stocks were traded actively on the day. NMB Bank Ltd witnessed the highest transaction of Rs 67 million, followed by NIC Asia Bank Ltd and Prabhu Bank Ltd which posted turnovers of Rs 50 million and Rs 46 million, respectively. Shares of Civil Bank Ltd also witnessed substantial transaction after the bank announced its 7th and 8th Annual General Meetings (AGMs) for May 10. The AGM is due to approve 10.25 percent and 4.05 percent bonus shares for fiscal years 2016/17 and 2017/18, respectively. Shares of Nepal Bank Ltd, Kumari Bank Ltd and Nepal Credit and Commercial Bank Ltd were also traded actively.

Among advances, share prices of Shree Investment Finance Co Ltd and Central Finance Co Ltd rallied by over 6 percent each. Besides, Microfinance scrips including Samudayik Laghubitta Bittiya Sanstha Ltd and Deprosc Laghubitta Bittiya Sanstha Ltd also posted gains of 5.96 percent and 5.56 percent, respectively. Meanwhile, shares of Prabhu Bank Ltd and Siddhartha bank Ltd also appreciated by over 5 percent each. However, shares of Universal Power Company Ltd bucked the trend as its price fell by over 3 percent to close at Rs 90 per share. Everest Insurance Company Ltd and Summit Microfinance Development Bank Ltd also logged losses of over 2 percent each. Synergy Power Development Ltd, Himalayan Distillery Ltd and Arambha Microfinance Bittiya Sanstha Ltd were among other losers with losses of 1.90 percent, 1.72 percent and 1.69 percent, respectively.

In corporate space, First Microfinance Laghubitta Bittiya Sanstha Ltd registered a 25.76 percent year-on-year net profit growth to Rs. 91.89 million. The company's annualized Earnings per Share (EPS) stands at Rs. 17.90.

ARKS technical analysis indicates the index substantiating previous day's advance with a bullish marubozu candlestick formation on the daily timeframe. The index has breached the resistances at around 1,193 point and psychological level at 1,200 points, suggesting firmly bullish sentiment in the present context. Given the index holds ground above 1,200 points, further bullish move can be expected in the upcoming sessions.

This column is produced by ARKS Capital Advisors Ltd
(Views expressed are those of the producer and do not necessarily reflect those of this publication)

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