Kathmandu, March 26
Heightened attraction to the stocks of commercial banks fuelled the market rally in the trading week of March 20 to 24, with the Nepal Stock Exchange (Nepse) index posting weekly gain of 30.61 points or 2.31 per cent to sail past the psychological level of 1,350 points to a record peak.
The benchmark index, which had opened at a previous high of 1,326.53 points on Sunday had surged by 17.4 points — highest single day gain in the week — to a fresh peak of 1,343.93 points by the day’s closing. On Monday, however, Nepse dipped 1.86 points on profit-booking. The local bourse remained closed on Tuesday for Holi celebrations.
When the market reopened on Wednesday, Nepse recovered the previous trading day’s loss by adding 3.46 points to set a new record at 1,345.53 points. As investors looked to offload shares of insurance and finance companies and pick up banking stocks, which had become relatively cheaper in the past few weeks, Nepse jumped 11.61 points to a new high of 1,357.14 points.
Prakash Rajaure, a stock market analyst, said stock investors could be seen swarming towards shares of commercial banks towards the end of the week on speculation that insurance and finance companies — which have posted impressive gains in recent weeks — may be nearing saturation.
In total, 6.61 million shares of 142 companies that amounted to Rs 3.44 billion were traded through 16,086 transactions during the week. The traded amount was 14.43 per cent less than the preceding week when the local bourse had remained open for five trading days. Back then, 18,407 transactions of 6.71 million scrips of 145 firms totalling Rs 4.02 billion had been undertaken.
The sensitive index, which gauges the performance of class ‘A’ stocks, rose 2.54 per cent to 292.48 points. Likewise, the float index that measures the performance of shares actually traded also climbed 2.17 per cent to 97.55 points.
Apart from trading, which remained constant at 201.38 points, all the subgroups ascended during the review period. However, banking and insurance firms were the major market movers.
The stock market rally was on the back of commercial banks, with the sub-index surging by 3.23 per cent to 1,233.87 points. Share price of Everest went up by Rs 195 to Rs 2,670, that of Nabil by Rs 85 to Rs 1,985 and of Standard Chartered by Rs 88 to Rs 2,970, among others.
Trailing close behind, insurance sub-index advanced by three per cent to 6,336.45 points. The subgroup had soared by 5.14 per cent on Sunday, but pared some of the gains in the later part of the week as investors worried the subgroup had neared saturation. Stock price of Nepal Life Insurance surged by Rs 325 to Rs 3,825 and that of Life Insurance Co Nepal by Rs 155 to Rs 3,755.
Because of Nepal Telecom’s share value rising by Rs 13 to Rs 715, the others subgroup climbed 1.85 per cent to 839.99 points.
Hotels recovered the previous week’s dip of 0.85 per cent by rising 1.46 per cent to 1,779.1 points. Even as Soaltee lost one rupee to Rs 327, the loss was offset due to Oriental rising by Rs 55 to Rs 495 and Taragaon Regency up four rupees to Rs 227.
The remaining gainers managed to post muted rise. Development banks rose 0.27 per cent to 1,360.88 points, hydropower was up 0.15 per cent to 2,318.39 points, finance edged up 0.12 per cent to 675.91 points and manufacturing inched up 0.01 per cent to 1,999.04 points.
National Hydropower topped the chart in all three categories of turnover, shares traded and number of transactions — recording turnover of Rs 286.06 million with 1.37 million of its scrips changing hands through 1,311 transactions.
The other top companies that clocked highest turnover were Nepal Life Insurance Co with Rs 262.58 million, Nepal Bank with Rs 249.66 million, Citizens Bank International with Rs 152.90 million and NMB Bank with Rs 151.02 million.
A version of this article appears in print on March 27, 2016 of The Himalayan Times.