daily market commentary

Stocks continue to fall in dull trade

Published On: August 9, 2018 08:52 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU: Stocks traded slightly higher in the morning session on Wednesday, but started sliding after midday losing a marginal 0.89 points to close the day at 1,187.32. With this, the benchmark Nepal Stock Exchange (Nepse) has shed values for fifth straight day.

The only bourse in the country witnessed another lifeless session on the day, recording year-low turnover of Rs 149 million. Both institutional and retail investors seemed to stay on the sideline, waiting for a major news or event to give a shot in the arm to the securities market.

Most of the sub-indices closed lower following the broader market, while Hotels, 'Others' and Finance stocks bucked the trend. Hotels sub-index experienced a surge of over 2 percent. In contrary, Manufacturing/ Process sub-index shed the highest 0.43 percent on its value. Life Insurance sub-index also closed down 0.38 percent. Banking stocks followed suit, with the group's sub-index dropping by 0.15 percent.  

First Micro Finance Dev Bank Ltd led the list of companies in terms of turnover. Shares worth Rs 8 million of the microfinance institution changed hands on Wednesday. Similarly, Everest Bank Ltd and NMB bank Ltd recorded turnovers of Rs 5 million and Rs 4 million, respectively. Nepal Life Insurance Co Ltd also logged total transaction of Rs 4 million. Other banking scrips also remained active on the day.

In terms of advances, Support Microfinance Bittiya Sanstha Ltd led the list of gaining stocks as its price hit the upper circuit of 10 percent for three consecutive days. Further, shares of Shrijana Finance Ltd, Om Dev Bank Ltd and Soaltee Hotels Ltd gained over 3 percent each. Other gaining stocks include, Nepal Community Dev Bank Ltd and Pokhara Finance Ltd

On the other hand, shares of Naya Nepal Laghubitta Bikas Bank and Vijaya Laghubitta Bittiya Sanstha Ltd took major knock, as their share prices tumbled over 5 percent each. Likewise, Purnima Bikas Bank Ltd also saw its share price slump over 4 percent. Furthermore, share prices of Progressive Finance Ltd, Himalayan Power Partner Ltd and United Insurance Co Ltd fell over 3 percent each.

In the corporate space, Nepal Agro Microfinance is on its course to issue over 144,000 units of shares in its initial public offering (IPO). After the issue, its paid-up capital will reach Rs 48 million. The microfinance Co has appointed Nepal SBI Merchant Banking Ltd as its issue manager.

As per the ARKS technical analysis model, the market has formed a bearish candlestick for the fifth straight day. However, the losses tend to be marginal, suggesting no real momentum in the downward movement seen of late. Despite market trending below 1,200 points, the current level between 1,180 and 1,200 points can be taken as a consolidation range where a breakout can suggest a possible course for the market. Technical indicators slightly favor the bears, but a solid trend is yet to be observed as the volume remains firmly in the lower spectrum.

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

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