KATHMANDU: After trending in green briefly in the morning, the Nepal Stock Exchange (Nepse) index maintained negative bias throughout the remaining trading hours. The index fell below the opening level by-mid day and witnessed a steady decline to close the day with a loss of 10.54 points at 1,110.08 points.

The losses of the day drove the index lower below 1,120 points mark for the first time in 8 months. Hence, investors have remained cynical overall with the bourse finding no notable respite in the months of late. Low budget spending from the government's side, tightening Credit to Core Capital plus Deposit (CCD) ratio and slackening deposit growth in the financial system are among few major issues restraining the equity market from making a recovery. Turnover remained on the lower side of the spectrum as Rs 280 million worth of equities were exchanged.

The broad downward rally dragged all sectors lower. Trading sector pulled back sharply as Salt Trading Corporation broke its gaining spree with a notable decline in its share price. The group's sub-index fell 7.65%. Next, Non-Life Insurance sector tumbled 1.41%, while Banking and Mutual Fund sub-indices dropped 1.02% each. Life Insurance and Finance stocks also struggled with each sector's sub-indices losing 0.97%. All other segments saw moderate losses.

NMB Bank Ltd led the list of actives with a total transaction worth Rs 21 million. Secondly, Nepal Bank Ltd witnessed a total turnover of over Rs 13 million. Sana Kisan Bikas Laghubitta Bittiya Sanstha Ltd's shares were also actively traded after the company announced its dividend for the year 2018/19. The wholesale microfinance will be distributing 27.25% bonus shares and 1.44% cash dividend after approval from its annual general meeting (AGM). Standard Chartered Bank Ltd, Prabhu Bank Ltd and Nabil Bank Ltd were among other top turnover scrips.

National Hydropower Company Ltd's shares witnessed some strength rising 4%. Api Power Company Ltd closely followed with gains of 3.88%. Microfinance stocks – Laxmi Laghubitta Bittiya Sanstha Ltd and National Microfinance Bittiya Sanstha Ltd posted advances of 3.07% and 2.58% each. Prime Life Insurance Company Ltd, Arun Valley Hydropower Development Co Ltd and Khanikhola Hydropower Co Ltd, meanwhile, rose around 2% each.

Conversely, Salt Trading Corporation, which was on a sustained uptrend, broke its winning run with a 10% slump. Gurkhas Finance Ltd and Prudential Insurance Co Ltd also came under pressure and shed over 5% each. Subsequently, Gurans Laghubitta Bittiya Sanstha Ltd and Life Insurance Co Nepal Ltd tanked over 4% apiece. Mountain Hydro Nepal Ltd, Sanima Mai Hydropower Ltd and Nepal Seva Laghubitta Bittiya Sanstha Ltd were the other major decliners.

ARKS technical analysis indicates the market forming a bearish candlestick on the daily timeframe dragging the index well below 1,120 points mark. The index hence broke its trading range towards the downside making further downfall likely. Technical indicators also indicate bears dominating the bourse. However, a crucial support lies at 1,100 points where investors can look for a rebound to take buying positions. On the other hand, a fall below this key support will point towards downtrend continuation.

 
• NEPSE