KATHMANDU: Strength was visible in the local bourse in the initial trading hours on Wednesday. Equities began trading on a positive note as the Nepal Stock Exchange (Nepse) index added more than 8 points early in the afternoon. 

Nonetheless, the benchmark index gave up most of its gains in the remaining trading hours. Eventually, Nepse closed the day at 1,105.53 points – up 2.97 points compared to Tuesday's close. 

The equity index seems to have found some support at around 1,100 points level as the benchmark rebounded from 1,102 points three times in seven days. As the index is trading range-bound of late, the market lacks significant conviction. 

Series of dry trading continued as the exchange recorded a total transaction worth Rs 220 million in the session. 

Traded sectors turned in mixed performance as six out of ten sub-indices ended the day slightly higher, while the remaining posted modest losses. Among gainers, 'Others' sub-index jumped 0.72 percent followed by Hotels sub-index which closed 0.42 percent higher.

Similarly, sub-indices of Life Insurance, Non-Life Insurance, Banking and Hydropower scrips also ended the day in green. On the other hand, Finance sub-index sank 0.52 percent followed by Manufacturing & Processing sub-index which posted a loss of 0.33 percent. Microfinance and Development Bank sub-indices also closed marginally lower. 

In terms of market activity, shares of Nepal Bank Ltd registered the highest turnover of the day. More than Rs 16 million worth of the commercial bank's shares changed hands. 

Next, Shikhar Insurance Co. Ltd posted a turnover of over Rs 13 million. Other commercial banks followed. Shares of NMB Bank Ltd and Agriculture Development Bank Ltd registered turnovers of Rs 10 million and Rs 9 million, respectively. Upper Tamakoshi Hydropower Ltd and Prime Life Insurance Company, meanwhile, saw total transactions of over Rs 5 million each. 

Among advances, Bhargav Bikas Bank Ltd turned in the best performance of the day as its share price rallied 8.73 percent. Tinau Development Bank Ltd, Sindhu Bikash Bank Ltd and Purnima Bikas Bank Ltd posted gains of 5.41 percent, 4.55 percent and 3.90 percent, respectively. Hydropower stocks followed suit as Ankhu Khola Jalavidhyut Company Ltd, Ngadi Group Power Ltd and Rairang Hydropower Development Company Ltd added over 3 percent each. 

In contrast, shares of Manjushree Finance Ltd, which resumed trading after 75 days, tumbled 3.47 percent. Kankai Bikas Bank Ltd, Swabalamban Laghubitta Bittiya Sanstha Ltd and Citizens Mutual Fund–1 also registered declines of over 3 percent each. Mission Development Bank Ltd, Mahalakshmi Bikas Bank Ltd and Reliance Finance Ltd were among other top losers. 

On the corporate front, Unilever Nepal Ltd published its second quarterly earnings results of fiscal year 18/19. The FMCG producer reported a 109 percent year-on-year growth in its net profit to Rs 320 million. 

ARKS technical analysis indicates a bullish candlestick formation on the daily timeframe. Meanwhile, the index has continued trading in the consolidation range with selling pressure easing recently. Momentum indicators also suggest fairly neutral sentiment prevailing in the current scenario. A breakout from the consolidation span of 1,100 to 1,120 points might suggest a plausible direction for the equity market. 

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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