Daily Market Commentary

Stocks end little changed as market activity sinks firmly

Published On: April 20, 2021 07:55 PM NPT

KATHMANDU, April 20: The equity market started the exchange on a lower note and lost 14 points within half an hour of trading. Nonetheless, the market recovered and managed to trade on the positive side of the spectrum. But again the market pulled the index towards red in mid-day. At the end, the benchmark Nepal Stock Exchange (Nepse) index closed the volatile trading session with a modest gain of 2.68 points gain at 2664.62.

The index has continued to see low volumes as investors have shown relatively subdued enthusiasm to participate in the market, due to which average turnover dropped markedly. Hence, the broader market registered a total turnover worth only Rs. 5.53 billion.

Development Bank and Hydropower were the day’s major gainers. The group’s sub-index tumbled 1.68% and 1.24% respectively. Trading, Hotels and Tourism, Finance, Manufacturing & Processing, Others, Microfinance, and Life Insurance stocks ended in a green note with a minor increment. On the other hand the Investment sector tumbled 1.03%.  Sub-indices of Banking, Non-Life Insurance, and Mutual Fund fell slightly.

Shares of Citizen Investment Trust was the most actively traded stock of the session. The scrip saw turnovers of Rs. 214 million. Nepal Infrastructure Bank Ltd, Nabil Bank Ltd, NIC Asia Laghubitta Bittiya Sanstha Ltd, and Arun Kabeli Power Ltd followed suit with transactions of Rs. 198 million, Rs. 158 million, Rs. 156 million and Rs. 143 million correspondingly. Likewise, Citizen Bank International Ltd, NIC Asia Bank Ltd, and United Modi Hydropower Ltd were the other heavily traded shares.

Shares of United Modi Hydropower Ltd and Mahila Laghubitta Bittiya Sanstha Ltd hit the upper circuit of positive 10%. Jyoti Life Insurance Company Ltd and Himalaya Urja Bikas Company Ltd also shot up above 9% each. Liberty Energy Company Ltd, Himalayan Power Partner Ltd and Janautthan Samudayic Laghubitta Bittiya Sanstha Ltd jumped by 8.07%, 7.77% and 7.53% respectively.

Samriddhi Finance Company Ltd, Oriental Hotels Ltd, NRN Infrastructure and development Bank Ltd, and Chhyangdi Hydropower Ltd, on the other hand, came under notable pressure. Their stock price tanked above 2% apiece. Hydroelectricity Investment and Development Bank Ltd, Rashtriya Beema Company ltd, NIC Asia Laghubitta Bittiya Sanstha Ltd and Best Finance Company Ltd slumped over 1% each.

In terms of ARKS technical analysis, the market formed a small spinning top candlestick suggesting indecision in the session. Following a decline in 2 consecutive days, the equity market found some footing on the day to close slightly higher. Likewise, the market has managed to close above the immediate support level of 2650. A breach below the 2650 mark can see some corrective move towards the downside to testing the psychological support level of 2600, while another day of gain supported by significant volume can see the index validate the rebound.

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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