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Benchmark index edges down slightly

2018-10-28

The country’s sole secondary market has been quite stable in recent weeks due to the festive season. Market experts have
explained that taking into account the general trend of the market, the index is moving in the right direction.

“The festive season directly hit the Nepal Stock Exchange (Nepse) index as well as investors,” said Uttam Aryal, chairman of Nepal Investors’ Association. “Investors usually withdraw money from banks and financial institutions (BFIs) during the festivals to celebrate and that money is yet to come back to the BFIs.”

He further added that unless the money that was withdrawn during the festive season returns to the BFIs, the stock market will not see many transactions. “Moreover, banks and financial institutions at present are facing cash crunch and are not so willing to provide loans for share trading and the central bank has not taken any initiative as such to solve the problem,” stated Aryal.

After witnessing a fluctuating trend in the week, the Nepse index went down by 0.04 per cent or 0.52 point in the trading week between October 21 and 25.

The sensitive index also dropped by 0.03 per cent or 0.09 point to 264.01 points, however the float index remained the same at 90.36 points.

In review period, the weekly turnover reached Rs 1.01 billion. In previous week, Nepse was open for only two days — October 14 and 15 — due to Dashain holidays and transactions worth only Rs 605.78 million were conducted.

The secondary market had opened at 1,241.63 points on Sunday and increased by 4.89 points by the end of the trading day. However, on Monday, the market went down by 1.98 points. Similarly, the local bourse again fell by 2.70 points the next day. On Wednesday, Nepse reversed course to rise 8.09 points.

However, on Thursday, it again fell by 8.82 points to close the week at 1,241.11 points.

In the review period, the hotels, manufacturing, finance, development bank and banking subgroups witnessed gains.

The hotels subgroup went up by 2.18 per cent or 40.57 points to 1,894.8 points. Share value of Soaltee increased by seven
rupees to Rs 255. Likewise, the manufacturing sub-index increased by 1.27 per cent or 28.48 points to 2,274.06 points with the share value of Unilever hiking by Rs 431 to Rs 23,431.

Similarly, the finance subgroup rose by 0.96 per cent or 5.92 points to 620.51 points. The development bank sub-index also increased by 0.32 per cent or 4.77 points to 1,491.26 points.

Banking — the subgroup with highest weightage in secondary market — inched up by 0.11 per cent or 1.31 points to 1,101.66 points.

On the other hand, non-life insurance subgroup plunged by 1.36 per cent or 78.66 points to 5,706.19 points, with share price of Shikhar Insurance down by Rs 12 to Rs 890. The microfinance sub-index dropped by 1.11 per cent or 16.47 points to 1,466.47 points.

Similarly, hydropower sub-index fell by 0.73 per cent or 10 points to 1,350.47 points. Likewise, trading went down by 0.72 per cent or 1.69 points to 232.16 points.

Meanwhile, others went down by 0.11 per cent or 0.87 point to 743.87 points and life insurance sub-index fell by 0.03 per cent or 1.71 points to 5,563.07 points.

In the review week, Prabhu Bank was leader in terms of weekly turnover with Rs 168.08 million. It was followed by NIC Asia Bank with Rs 67.07 million, Kumari Bank with Rs 55.47 million, Mega Bank with Rs 37.73 million and NMB Bank with Rs 35.82 million.

In terms of weekly trading volume too, Prabhu Bank took the lead with 673,000 of its shares changing hands. Kumari Bank with 217,000 shares, Mega Bank with 184,000 shares, NIC Asia Bank with 151,000 shares and Janata Bank with 150,000 shares were the other top firms to record high trading volume.

Meanwhile, Kalika Power Company topped the chart in terms of number of transactions — 2,017. It was followed by Panchakanya Mai Hydropower with 1,297, Prabhu Bank Nepal with 1,159, Nadep Laghubitta Bittiya Sanstha with 788 and Mega Bank with 512 transactions.

Source: The Himalayan Times