daily market commentary

Stocks start week on a positive note

Published On: October 15, 2018 09:05 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU: Nepal Stock Exchange (Nepse) index gained 14.15 points on Sunday -- the first trading day of the week. Though stocks, which saw strength in the initial trading hour, traded flat for most of the trading sessions, a surge toward the final trading hour pushed the benchmark index to 1,242.43 points at the close.

However, the recent rise has come on the back of relatively bland trading sessions. Despite a slight improvement in market activity, daily turnover remained subdued as only Rs 269 million worth of shares were traded on Sunday. 

Most of the sectoral indices closed the day in green with biggest gain coming from Hotels segment. The segment's sub-index rallied by over 3.09 percent on the day. Banking and Non-Life Insurance stocks followed suit, as their respective sub-indices climbed up by 1.6 percent and 1.54 percent. Sub-indices of Development Bank and Life Insurance scrips also added over 1 percent on the day. Conversely, Manufacturing & Processing stocks were the biggest drag in the exchange with its sub-index tumbling by 4.13 percent. Hydropower sub-index also edged marginally lower. 

In terms of activity, investors mainly seemed enthused in trading shares of commercial banks. NMB Bank Ltd posted the highest turnover as Rs 24 million worth of its shares were traded on the day. Similarly, stocks worth Rs 21 million each of Mega Bank Ltd and Janata Bank Nepal Ltd changed hands on Sunday. Other active stocks of the day include NIC Asia Bank Ltd, Prabhu Bank Ltd and Kumari Bank Ltd.

On advances, mutual fund units of NMB Sulav Investment Fund-1 turned in the best performance of the day with its unit price rallying by almost 6 percent. The mutual fund had announced 21.05 percent cash dividend to its unit holders. Similarly, Nepal Sewa Laghubitta Bittiya Sanstha extended its rally, adding 5.85 percent. Shares of Sahayogi Bikas Bank Ltd also appreciated by 5.83 percent. Further, share prices of Neco Insurance Co Ltd, Green Development Bank Ltd, Miteri Development Bank Ltd and Mega Bank Ltd also jumped over 5 percent each.

On the contrary, share price of Unilever Nepal Ltd slumped by over 7 percent. Next on the list of decliners was Panchakanya Mai Hydropower Ltd which saw its share price depreciate by 6.62 percent. Similarly, share price of Ngadi Group Power Ltd fell by over 2 percent. Best Finance Co Ltd, Dibyashwori Hydropower Ltd and Civil Laghubitta Bittiya Sanstha Ltd were among other top losers of the day. 

On news, RSDC Laghubitta Bittiya Sanstha Ltd has revised its dividend announcement. The Co, which had announced 5 percent cash dividend and 5 percent bonus shares, will now be distributing 10 percent bonus shares to its shareholders. 

ARKS technical analysis indicates the market forming a bullish marubozu candlestick, closing above the immediate resistance of 1,234 points. Nonetheless, the overall sentiment remains fairly neutral as the market activity remains subdued ahead of the holidays. Hence, investors are better off maintaining a watchful stance before taking any significant long position in the present context.

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

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