Nepal | September 28, 2020

Nepse trading hit as investors wait and see

Himalayan News Service
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Source: Nepse

Kathmandu, December 17

The slight recovery witnessed in the domestic share market in the latter part of the trading week — between December 11 and 15 — helped the Nepal Stock Exchange (Nepse) index to limit its weekly loss to 14.62 points or 0.95 per cent.

More worrying, the weekly transaction amount, which had plunged by 43.63 per cent in the previous week, slumped again by 41.15 per cent this time around.

“The commercial banks have either already raised their capital to meet the requirement of the central bank or are close to it, but the uncertainty regarding whether they will be able to give the same returns have weighed on investor confidence,” explained Prakash Rajaure, general secretary of Nepal Stock Investors’ Association.

According to him, mutual funds seem to have also adopted wait-and-see mode at present, which is why there has been no bulk transactions in the recent days, hence, the fall in transaction amount.

In total, 3.13 million shares of 156 companies that amounted to merely Rs 1.93 billion were traded through 15,259 transactions during the week. In comparison, 23,321 transactions of 4.30 million scrips of 154 firms that amounted to Rs 3.29 billion had been undertaken the previous week.

The benchmark index had opened at 1,544.68 points on Sunday and had dropped by 21.88 points by the day’s
closing. Nepse continued on the downward trajectory on Monday by falling 13.37 points. The market remained closed
on Tuesday as the country celebrated Udhauli Parva. On Wednesday, the local bourse reversed course and went up
by 6.65 points and added another 13.98 points on Thursday to settle at 1,530.06 points for the week.

The sensitive index, which gauges the performance of class ‘A’ stocks, fell by 3.43 points or 1.02 per cent to 331 points. Similarly, the float index that measures the performance of shares actually traded also dipped by 0.98 point or 0.85 per cent to 114.1 points.

Apart from trading, which remained stationary at 203.91 points, manufacturing and others were the only two subgroups to land in the green zone. The sub-index of manufacturing inched up by 3.28 points or 0.15 per cent to 2,221.47 points, while that of others edged up 0.29 point or 0.04 per cent to 735.48 points.

Hydropower saw the biggest fall in the week as the subgroup fell by 67.27 points or 3.49 per cent to 1,860.71 points. Shareholders of Chilime saw the value of their stocks drop 4.11 per cent to Rs 980, those of Sanima Mai lost 2.98 per cent to Rs 815 and of Api witnessed their share price dive by 13.78 per cent to Rs 413.

After advancing by 1.04 per cent in the previous week, hotels retreated by 48.38 points or 2.49 per cent to 1,893.28 points. Soaltee was down 11.45 per cent to Rs 317, Oriental was down 2.06 per cent to 475 and Taragaon dropped 3.65 per cent to Rs 211.

Finance fell 8.25 points or 1.11 per cent to 733.01 points, weighed down by Citizen Investment Trust descending by 1.05 per cent to Rs 3,945.

The remaining three subgroups — banking, development banks and insurance — managed to limit their losses below one per cent.

Development banks fell 15.36 points or 0.97 per cent to 1,572.12; banking shed 13.56 points or 0.92 per cent to 1,461.86 points; and insurance dropped 63.25 points or 0.86 per cent to 7,302.38 points.

As per Rajaure, until the share market is fully automated, the benchmark index will likely hover in this range.

Meanwhile, Everest Bank topped the chart in terms of number of transactions and weekly turnover, recording 1,056 transactions under its name that amounted to Rs 309.6 million. The other listed companies to make it to the list of top-five with regards to turnover were Siddhartha Bank with Rs 103.13 million, Bank of Kathmandu Lumbini with Rs 73.48 million, Machhapuchchhre Bank with Rs 58.53 million and Life Insurance Corporation Nepal with Rs 58.37 million.

NMB Sulav Investment Fund – I was the forerunner in trading volume with 210,000 of its scrips changing hands.

A version of this article appears in print on December 18, 2016 of The Himalayan Times.

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