KATHMANDU, July 5: Stocks remained under pressure throughout the session despite a higher open on Monday. The Nepal Stock Exchange (Nepse) index fell more than 10 points in the morning before clawing its way back towards the opening level at mid-day. However, with modest buying interest seen in almost all of the sectors, stocks remained in negative territory throughout the latter trading hours. At the close, Nepse posted a loss of 11.78 points to end at 2,822.74.

Selling momentum is gradually tapering off in the recent sessions, but the absence of buyers in heavy volumes has seen the market post gradual declines. Market participation has also tanked sharply with the index registering heavy correction amidst approaching quarter-end. Turnover remained at Rs. 4.5 billion, its lowest since early May.

Sectors ended mixed with Manufacturing & Processing and Trading sub-indices leading the gains. The respective sub-indices rallied over 3%. Investment, ‘Others’ and Mutual Fund sectors also inched higher. On the other hand, Finance and Development Bank sub-indices corrected firmly to end the session more than 2% lower. Hydropower, Hotels and Tourism sub-indies saw modest dips.

Himalayan Distillery Ltd led the list of actives accounting for almost 10% of the day’s volume. Over Rs. 412 million worth of the beverage manufacturer’s shares changed hands. Upper Tamakoshi Hydropower Ltd and Nepal Bank Ltd followed suit with turnovers of Rs. 194 million and Rs. 156 million. Nepal Infrastructure Bank Ltd and Nepal Telecom Ltd saw transactions of around Rs. 13 million each. National Hydropower Company Ltd, Nepal Insurance Company Ltd and Nepal Reinsurance Company Ltd were among other actively traded stocks.

Bishal Bazar Company Ltd outperformed as the scrip recouped 10% following a steady decline in the past month. Himalayan Distillery Ltd and Chhyangdi Hydropower Ltd also rallied around 8% each. CEDB Hydropower Development Company Ltd and Nepal Lube Oil Ltd posted gains of around 5% each. Hydroelectricity Investment & Development Company Ltd, Narayani Development Bank Ltd were among other major gainers.

Gurkhas Finance Ltd, conversely, suffered the biggest decline with its price ending more than 6% lower. Karnali Development Bank Ltd and Guheshwori Merchant Bank & Finance Co. Ltd plunged 5.18% and 4.73%, respectively. National Hydropower Company Ltd, Nepal Insurance Company Ltd and Multipurpose Finance Ltd also suffered notable losses.

On the technical front, Nepse index formed a small bearish candlestick suggesting modest selling pressure in the session. Technical indicators also point towards extension of short-term downward move. Further, with volumes continuing to drop, a consolidation can be expected above the 2,800 mark. Meanwhile, a breach of the psychological level towards the downside can see the index test support at around 2,740-2,750 mark.

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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