Banks’ Q3 reports fuel bullish market sentiment

Kathmandu, May 21

Encouraging third quarterly reports of the commercial banks gave a major boost to investor sentiment, propelling the Nepal Stock Exchange (Nepse) index to clock a weekly gain of 17.38 points or 1.17 per cent in the week of May 15 to 19 to close only 0.68-point shy of breaching the 1,500-point threshold.

Rabindra Bhattarai, a stock market analyst, had recently told The Himalayan Times that the recent trend can also be attributed to the seasonal phenomenon. Normally, the market witnesses a bullish trend from mid-April to mid-August, he had said.

Opening at 1,481.94 points on Sunday, the benchmark index had dipped 4.56 points by the day’s closing. Nepse continued southbound on Monday by shedding another 9.87 points. Following the news of commercial banks making good profits despite adverse economic conditions, the local bourse surged by 16.17 points on Tuesday. On Wednesday, it added another 12.73 points to reach a new high of 1,496.41 points. Nepse recorded a fresh peak the very next day by inching up 2.91 points to end the week at 1,499.32 points.

Altogether, 6.96 million shares of 153 companies that amounted to Rs 4.29 billion were traded through 20,545 transactions in the week. The weekly turnover was 18.69 per cent less than the preceding week when 23,228 transactions of 8.41 million shares of 149 companies worth Rs 5.29 billion had been undertaken.

The sensitive index, which gauges the performance of class ‘A’ stocks, rose 1.20 per cent to 324.44 points. Likewise, the float index that measures the performance of shares actually traded also edged up 1.57 per cent to 109.24 points.

Whereas trading remained constant at 201.38 points, similar to previous week, manufacturing was the only subgroup to land in the red. This was primarily because Unilever’s share value plunged by Rs 1,268 to Rs 32,732 and dragged the manufacturing sub-index down 2.83 per cent to 2,284.18 points.

Similar to the earlier week, insurance subgroup led the pack of gainers, advancing 1.71 per cent to 7,170.31 points. Share value of National Life Insurance went up by Rs 159 to Rs 3,000, and that of Sagarmatha Insurance by Rs 148 to Rs 1,589.

Development banks climbed 1.42 per cent to 1,477.35 points. Nagbeli surged by Rs 225 to Rs 3,900, Nirdhan Utthan by Rs 45 to Rs 1,990 and Sana Kisan by Rs 65 to Rs 1,980.

Trailing close behind, banking added 1.37 per cent to settle at 1,410.21 points. Share price of Nabil closed at Rs 2,281 (up Rs 31), Nepal SBI landed at Rs 1,770 (up Rs 38) and Century Commercial Bank at Rs 420

(up Rs 38).

The rest of the gainers only saw muted growth — hydropower up 0.66 per cent to 2,260.36 points; others up 0.61 per cent to 775.38 points; hotels up 0.49 per cent to 1,951.82 points; and finance up 0.25 per cent to 728.24 points.

Nepal Life Insurance took the lead in terms of turnover with Rs 333.32 million, followed by Nepal Bangladesh Bank with Rs 202.48 million, Prabhu Insurance with Rs 185.31 million, Sanima Bank with Rs 174.92 million and Nepal Bank with Rs 157.86 million.

Nabil Balanced Fund – I was the forerunner in terms of number of shares traded, with 431,000 of its scrips changing hands. Century Commercial Bank topped the chart with regard to number of transactions — 983.