Currency
Nepali rupee gained 35 paisa against a US dollar over the week. This made imports cheaper, but lowered income of exporters and remittances receivers. On Friday, a dollar was valued at Rs 79.30.
Nepal Rastra Bank (NRB), country´s monetary authority, had set the exchange rate of a US dollar at Rs 79.65 when the market opened this week on Sunday. However, as the demand for dollar spiraled down in India, rupee bounced back strongly over the next couple of days. It gained a whopping Rs 1.35 against a dollar on Monday and another 2 paisa on Tuesday. The exchange rate of US dollar remained unchanged on Wednesday. However, rupee shed 76 paisa on Thursday as dollar bounced back strongly against Indian rupee. Rupee further shed another 26 paisa on Friday, when the market closed this week.
Likewise, rupee gained Rs 3.92 against a euro and Rs 1.67 against a pound sterling over the week. A euro was exchanged at Rs 109.04, while a pound sterling was valued at Rs 126.42 on Friday.
Bullion
Price of gold, on the other hand, jumped by Rs 595 per 10 grams, making gold dearer by Rs 694 per tola (11.664 grams) in the domestic market over the week. The yellow metal was traded at Rs 45,950 per 10 grams on Friday and gold dealers attributed the price jump to rise in demand for gold in the international market.
Bullion trading had opened this week with gold priced at Rs 45,355 per 10 grams on Sunday. As major stock markets recovered and dollar rallied against major rival currencies, gold shed Rs 515 per 10 grams on Monday. Though dealers left the price of gold unchanged on Tuesday, the yellow metal rallied over the following trading days. Gold became expensive by Rs 430 per ten grams on Wednesday and the price further jumped by Rs 170 per 10 grams on Thursday. Gold became expensive by another Rs 550 per ten grams when the market closed this week on Friday.
Prices of silver, on the other hand, dipped by Rs 8.50 per 10 grams in domestic market. Silver was traded at Rs 943 per 10 grams on Friday.
Stock
The Nepal Stock Exchange (Nepse) index (+4.74 percent) gained a whopping 15.55 points this week with the benchmark index closing at 343.54 points on Thursday. The market rallied on Wednesday, gaining 16.61 points; however, it failed to sustain the momentum as it slid by 3.28 points on the closing day.
The sudden gain in the index can be primarily attributed to the positive political development in the country. However, the average daily market turnover (not considering the bulk trading of Progressive Finance Limited´s promoter shares worth Rs 18,655,700) decreased by 15 percent.
The Commercial Banking sub-index (+7.59 percent) was the biggest gainer of the week, as shares prices of Global Bank (+Rs 22), Citizens Bank International (+Rs 22), Agricultural Development Bank (+Rs 14) and Standard Chartered Bank (+Rs 170) appreciated. Similarly, the Others´ sub-index (+5.31 percent) went up due to rise in share prices of Nepal Telecom (+Rs 18). The Insurance sub-index (+2.86 percent) followed suit, as share values of Surya Life Insurance (+Rs 11) and Nepal Life Insurance (+Rs 40) increased. Likewise, the Development Banking sub-index (+1.37 percent) rose, as share prices of Ace Development Bank (+Rs 17) and NDEP Development Bank (+Rs 8) gained values. The hydropower sub-index (+0.92 percent) also closed the week on green territory, as share prices of Arun Valley Hydropower Company (+Rs 13) and National Hydropower Company (+Rs 2) ascended. The Finance sub-index (+0.50 percent) also recorded marginal gain helped by rise in share prices of Kaski Finance (+Rs 10) and Api Finance (+Rs 10).
Amongst news and highlights, Sanima Bikas Bank has got the Nepal Rastra Bank´s nod to operate as a full-fledged commercial bank. The central bank has also given a green signal to Annapurna Finance to upgrade into a development bank; and Infrastructure Development Bank and Swastik Merchant Finance to undergo merger. Ordinary shares of Shangri-La Development Bank, Multipurpose Finance Company, Shine Development Bank, and Hama Merchant & Finance Limited have been listed for trading at the Nepse.
As for company announcements, Diprosc Development Bank has announced to distribute 28 percent cash dividend; and Narayani National Finance is distributing 10.52 percent cash dividend. Similarly, DCBL Bank has proposed to distribute 4.12 percent bonus shares and Chhimek Lagubitta Bikas Bank has proposed to distribute 25 percent cash dividend. Likewise, Prime Life Insurance Company has proposed to distribute 20 percent bonus shares; and NMB Bank and Kaski Finance have proposed to distribute 9 percent cash dividend and 14.69 percent bonus shares respectively. All the above announcements are subject to approval from their respective regulatory bodies and their annual general meetings.
On the IPO side, Sambridhi Bikas Bank is issuing 300,000 units of ordinary shares in the near future.
Forecast: Technical analysis indicators signal downward pressure, as the market is in a overbuy position.
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