Stocky rally as most sectors register notable weekly gains

KATHMANDU, Dec 5: Nepal Stock Exchange (Nepse) opened week with a considerable strength.

On Sunday, the benchmark shot up by 75 points followed by another upbeat session on Monday where the index another 28.78 points.

A volatile trading session on Tuesday saw the index waver in green and red with the major average adding another 3.35 points to hit the 2,000 mark for the first time in history.

On Wednesday, the stock market witnessed a gain of 70.62 points.

Some correction was witnessed in the last trading day of the week as Nepse fell 15.57 points on Thursday.

Overall, the index shot up by 162.2 points, or 8.57%, in the week to finish at 2,055.45 points.

With the index breaching its all-time high in the week earlier, investors are taking heavy long positions preventing index from making any major retracements. Even though some intra-day reversals are witnessed in the recent trading sessions, the stock market is yet to suffer any major loss. Market activity in the week also reached unprecedented levels as over Rs 40 billion worth of securities were exchanged in the review period.

Class ‘A’ stock also saw notable gain as the Sensitive Index rose 7.42%. Among sectors, ‘Others’ and Hydropower segments led the broader market’s advance and rallied over 17% each. Life Insurance sector and Microfinance sector followed suit with gains of 14.92% and 11.52%. Manufacturing& Processing, Banking, Development Bank, Non-Life Insurance and Hotels sub-indices also ended in green. On the other hand, Trading index pulled back sharply and ended 7.28% lower. Mutual Fund and Finance sectors also suffered minor losses.

On the turnover front, Nepal Reinsurance Company Ltd’s shares were traded the most with turnover of over Rs. 2 billion. Nepal Telecom Ltd followed suit with turnover of Rs. 1.3 billion. Nepal Bank Ltd, Nepal Life Insurance Co. Ltd, Himalayan Distillery Ltd, NIC Asia Bank Ltd and Nabil Bank Ltd were among other top turnover stocks with transactions of Rs 1 billion.

As per the ARKS technical analysis, the market formed another bullish candlestick on the weekly timeframe. With formations of back-to-back bullish candlesticks, momentum strongly favors the bulls. Hence, the overall uptrend is likely to stretch further but investors must keep an eye for some minor corrections on the way, where a rebound can provide opportunities to go long in the equity market.

This column is produced by ARKS Capital Advisors Ltd.

www.arkscapitaladvisors.com

(Views expressed in the article are those of the producer and do not necessarily reflect those of this publication)

 
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