Daily Market Commentary

Stocks close higher after Monday's loss

Published On: April 24, 2019 02:30 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, April 24: Stocks witnessed some volatility on Tuesday as the benchmark Nepal Stock Exchange (Nepse) index gyrated between gains and losses in the session. Nepse opened on a firm note, gaining over 10 points in the first trading hour. The index, however, pared most of its gains in the afternoon and fell below the 1,250-point mark. Nonetheless, a rise toward the close saw the index end the day with a modest gain of 3.74 points at 1,260.68 points.

After witnessing some correction on Monday, the local bourse lacked conviction on Tuesday. Both buyers and sellers remained active on the day contributing to the marginal movement of the index. Relatively cautious trading was seen on the day as total turnover fell to Rs 614 million compared to Rs. 1,038 million a day earlier.

Sectoral indices turned in mixed performance on the day. Manufacturing & Processing sub-indices led the gaining sides with a surge of 2.29 percent. The market heavyweight banking stocks also advanced. The group's sub-index edged up by 0.58 percent. Non-life Insurance, Finance and Development Bank sub-indices also ended the day in green. In contrast, Trading sub-index slumped 1.13 percent followed by Hotels sub-index which closed 0.97 percent lower. Sub-indices of Hydropower, Life Insurance, Microfinance and 'Others' scrips also witnessed modest losses.

Shares of Chhimek Laghubitta Bikas Bank Ltd were heavily traded on the day with total transactions worth Rs 50 million. Commercial bank scrips followed suit, as Nepal Bank Ltd, NMB Bank Ltd and NIC Asia Bank Ltd saw Rs 42 million, Rs 29 million and Rs 27 million worth of shares traded, respectively. Promoter Shares of Chhimek Laghubitta Bikas Bank Ltd and Nabil Bank Ltd were also traded actively on the day.

Everest Insurance Company turned in the best performance of the day as its price hit the upper circuit of 10 percent for a second day in a row. Strength was also seen among shares of Shree Investment Finance Co Ltd and Radhi Bidyut Company Ltd as their respective share prices shot up by 7.14 percent and 6.58 percent. Furthermore, Unnati Microfinance Bittiya Sanstha Ltd and Unilever Nepal Ltd saw their share prices go up by over 4 percent each.

Conversely, energy stocks came under pressure on the day. Share prices of Ghalemdi Hydro Ltd and Arun Kabeli Power Ltd closed 4.79 percent and 4.67 percent lower, respectively. Bhargav Bikas Bank Ltd's share price also tanked over 4 percent, while Synergy Power Development Ltd, NIBL Pragati Fund and Central Finance Co Ltd also ended the day in red.

On earnings front, Barun Hydropower Company Ltd published its financials for the third quarter of FY2018/19. The hydropower company posted net loss of Rs 2.14 million against Rs 5.54 million in the corresponding quarter previous year. In other news, Grameen Bikas Laghubitta Bittiya Sanstha Ltd will be floating 3.275 million units of right shares to its shareholders from May 10.

The benchmark index, as per the ARKS technical analysis, formed another spinning top candlestick pattern indicating indecision prevailing in the market. The market is consolidating following its surge in the previous month. Nonetheless, the bullish momentum is yet to subside. A breach of 1,280 points to the upside might see further rise in the index. Meanwhile, the market's immediate support lies at 1,250 points.

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