KATMANDU, July 5: Equities remained under pressure throughout the session despite an open higher on Monday. The Nepal Stock Exchange (Nepse) index lost more than 10 points in the morning before making its way to the opening level at midday. However, with modest buying interest seen across almost all sectors, stocks remained in negative territory throughout the last few hours of trading. At the close, Nepse recorded a loss of 11.78 points to end at 2,822.74.
The selling momentum has gradually faded over the past few sessions, but the absence of high volume buyers has seen the market show gradual declines. Market participation also fell sharply as the index corrected sharply as the end of the quarter approached. Turnover remained at Rs. 4.5 billion, its lowest since early May.
The sectors ended mixed with the Manufacturing & Processing and Trading sub-indices leading the gains. The respective sub-indices increased by more than 3%. The investment, “other” and mutual fund sectors also edged up. On the other hand, the sub-indices of the Bank of Finance and Development corrected sharply to end the session down by more than 2%. The hydropower, hospitality and tourism sub-industries experienced modest declines.
Himalayan Distillery Ltd tops the list of assets accounting for almost 10% of the day’s volume. More than Rs. 412 million shares of the beverage maker changed hands. Upper Tamakoshi Hydropower Ltd and Nepal Bank Ltd followed suit with turnover of Rs. 194 million and Rs. 156 million. Nepal Infrastructure Bank Ltd and Nepal Telecom Ltd recorded transactions of approximately Rs. 13 million each. National Hydropower Company Ltd, Nepal Insurance Company Ltd and Nepal Reinsurance Company Ltd were among other actively traded stocks.
Bishal Bazar Company Ltd outperformed, with scrip recovering 10% after declining steadily last month. Himalayan Distillery Ltd and Chhyangdi Hydropower Ltd also gained around 8% each. CEDB Hydropower Development Company Ltd and Nepal Lube Oil Ltd recorded gains of around 5% each. Hydroelectricity Investment & Development Company Ltd, Narayani Development Bank Ltd were among the other big winners.
Gurkhas Finance Ltd, conversely, suffered the biggest drop with its price ending more than 6% down. Karnali Development Bank Ltd and Guheshwori Merchant Bank & Finance Co. Ltd plunged 5.18% and 4.73% respectively. National Hydropower Company Ltd, Nepal Insurance Company Ltd and Multipurpose Finance Ltd also suffered notable losses.
Technically, the Nepse index formed a small bearish candlestick suggesting modest selling pressure during the session. Technical indicators also point to the extension of the short-term bearish movement. Additionally, with volumes continuing to decline, a consolidation can be expected above the 2,800 mark. Meanwhile, a break from the psychological level towards the downside may see the index’s test support at around 2 740-2750.
This column is produced by ARKS Capital Advisors Ltd.
(The opinions expressed in the article are those of the producer and do not necessarily reflect those of this publication)