KATHMANDU, Sept 6: The local bourse experienced another active week with both the Nepal Stock Exchange (Nepse) index and volumes shooting up towards multi-year record levels. The index began the week on a slightly upbeat note with a gain of 4.63 points on Sunday. Monday saw the bourse add another 22.32 points. While the market remained closed on Tuesday, stocks resumed trading with considerable strength on Wednesday with a 25.58 points gain. Stocks took a breather in the last session of the week and ended almost flat on Thursday. Overall, the index gathered 52 points or 3.59 % to close the week at 1,510.42.
This week, the stock market continued to attract notable investments into the market. Despite the market opening for only 4 days, week-on-week turnover shot up by over 20 % to Rs. 11.90 billion. Hence, sentiment remains firmly positive on the back of constant surge in money flow into the equity market. Traders opting for relatively volatile stocks in the week have contributed in pushing many company’s prices towards their adjusted all-time highs. The news of alterations in the national assembly that came on Thursday, including the change in finance minister will likely play a key role in determining the index’s movement in the week ahead.
Sensitive Index, gauging the performance of Class ‘A’ stocks’ slightly underperformed but closed firmly in green. The index rose 2.57 %. All sectors closed in green in the week, with ‘Others’ and Hydropower sectors leading the charge. While the former jumped 12.91 %, the latter rallied 11.57 %. Trading, Manufacturing & Processing and Non-Life Insurance sub-indices also registered notable surge with respective gains of 4.91 %, 3.83 % and 3.74 %. Heavyweight banks, which are relatively stable, also eked out a gain of 1.17 %.
Among actives, Nepal Reinsurance Company Ltd registered the highest weekly turnover of over Rs. 1.7 billion. The jump in volumes came as the scrip’s price shot up by over 25 % in the week, making it the second largest company by market capitalization only after telecom heavyweight Nepal Telecom Company Ltd.
Other actively traded shares include Neco Insurance Company Ltd and Nepal Life Insurance Company Ltd with transactions worth Rs. 504 million and Rs. 455 million, respectively. Shivam Cements Ltd, Shikhar Insurance Company Ltd and Himalayan Distillery Ltd posted turnovers of Rs. 399 million, Rs. 383 million and RS. 338 million. Besides, mainly insurance stocks were heavily traded in the week.
This week, the exchange listed 320,000 unit bonus shares of Samudayik Laghubitta Bittiya Sanstha Ltd and over 3 million unit right shares of Shikhar Insurance Company Ltd.
On the technical front, Nepse marked a bullish candlestick for a second straight week making a fresh weekly closing high since trading resumption post lockdown at the end of June. Consequently, the index has continued to make higher top and higher bottom keeping the weekly uptrend intact. Further, weekly technical indicators also suggest that the equity market has momentum for some more upside movement. Further, the index also lies above its 5-day, 20-day and 50-day exponential moving averages (EMAs) which also technically represents the overall bullish trend.
This column is produced by ARKS Capital Advisors Ltd