daily market commentary

Stocks unchanged in choppy trading

Published On: November 15, 2018 08:14 AM NPT

KATHMANDU, Nov 15: The secondary market witnessed a slightly volatile trading session on Wednesday. The benchmark Nepal Stock Exchange (Nepse) index opened the day on a negative note and shed 4 points by mid-session. However, stocks staged a rebound in the latter hours, helping the index to post a modest gain of 0.98 points to settle at 1,208.56 points. 

Following the previous day's gains, stocks showed lack of direction throughout Wednesday's session as investors seemed wary of the plausible direction of the equity market. Meanwhile, the bourse added to its series of sub-par market activity with a total turnover of Rs 178 million.

Major trading groups turned in mixed performance on the day. Marginal gains came from Non-life Insurance, Banking and Development Bank stocks as the groups' sub-indices added 0.6 percent, 0.26 percent and 0.24 percent, respectively. However, the advances were offset by losses from other segments, contributing to the modest movement of the broader market. Life Insurance stocks suffered the most as its sub-index fell by 0.82 percent. Finance and Hotels sub-indices were also down by 0.62 percent and 0.43 percent, respectively.

Prabhu Bank Ltd continued to trade actively as the class 'A' bank's shares posted the highest turnover of over Rs 30 million on the day. Next on the list of active stocks were Kumari Bank Ltd and Nepal Bank Ltd who logged total transactions of over Rs 10 million each. Mega Bank Ltd, Civil Bank Ltd and NMB Bank Ltd were among other companies with top turnovers.

The biggest gain came from United Insurance Company Ltd as its share price jumped by almost 4 percent. Shares of Samata Microfinance Bittiya Sanstha Ltd closely followed posting a gain of 3.90 percent. Unit price of Siddhartha Equity Fund also went up by 3.56 percent. Other advances of the day included Nepal Seva Laghubitta Bittiya Sanstha Ltd, Oriental Hotels Ltd and Arun Valley Hydropower Development Company Ltd.

Among the ordinary shares exchanged on Wednesday, shares of Mahuli Samudayik Laghubitta Bittiya Sanstha Ltd posted the biggest daily decline of 4.21 percent. Share price of Shangrila Development Bank Ltd also skidded 3.33 percent after the bank posted a 53 percent year-on-year decline in its first net profit for the first quarter of Fiscal Year 2018/19. Further, Barun Hydropower Company Ltd and Kankai Bikas Bank Ltd lost over 3 percent on their respective share prices.

On the earnings front, Kumari Bank Ltd posted a substantial increment in its earnings as per its financial report for the first quarter of FY2018/19. According to the report, its net profit grew by 143 percent year-on-year. Everest Bank Ltd also reported a decent 19 percent growth in its net profit. However, net profit of Nepal Bank Ltd dropped by 6 percent in the first quarter.

As per the ARKS technical analysis, the buying pressure subdued slightly on Wednesday with Nepse closing marginally higher. Despite the gains seen in two straight sessions, technical indicators suggest that the market is yet to show a significant rebound to derail the recent downtrend. On a positive note, the index has retraced and held ground above the psychological level of 1,200 points.

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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