No respite for Nepse

KATHMANDU, June 17: The market (-1.73%) attempted to revive on the last trading day of the week but ended on red to close at 303.53 points on Thursday. The market eroded to 292.32 points during the week. However, it rallied on the last trading day led by the surge in the commercial banking sub index as it gained impressive 14.43 points.



Moreover, the average daily market turnover decreased by 24.83% as compared with the previous week.[break]



The Commercial Banking sector (-4.32%) for the third consecutive week was the biggest loser among all sub-indices as share prices of key banks such as Laxmi Bank (-Rs.71), Nepal SBI Bank (-Rs.61), Nabil Bank (-Rs.125), and NMB Bank (-Rs.19) dropped. The Hydro-Power sector (-4.09%) followed suit as share prices of Arun Valley Hydropower (-Rs.64) and Chilime Hydropower Company (-Rs.77) continued to deteriorate.



Similarly, the Insurance sector (-2.82%) continued to slide as share prices of Life Insurance Company Nepal (-Rs.27) and Prime Life Insurance Company (-Rs.7) declined. Likewise, the Development Banking sector (-2.29%) slid as City Development Bank (-Rs.30), and Clean Energy Development Bank´s (-Rs.16) share prices tumbled. The Finance sector (-1.18%) also disappointed investors as IME Financial Institution (-Rs.24), and Sagarmatha Merchant Banking & Finance (-Rs.12) share prices plummeted. Nevertheless, the ´Others´ sector (+3.97%) defied the market pattern as Nepal Telecom´s (+Rs.15) share price appreciated.



In order to stabilize the current liquidity crisis and instability seen in the financial system, the Parliamentary Finance and Labor Relations Committee of the parliament have instructed NRB to come up with a concrete action plan at the earliest. Similarly, NRB to ease the liquidity crunch has opened refinancing facility to BFIs. The Special AGM of Shikhar Finance Limited and Kasthamandap Development Bank have approved the purposed merger with each other.



As for company announcements, Gurans Life Insurance Company is holding its 3rd AGM on July 8 (book closure: June 24). Pathibhara Bakas Bank Limited is selling 116,270 units of undersubscribed ordinary shares on auction starting from June 19. Similarly, Lord Buddha Finance is selling 25,088 units of undersubscribed promoter shares and 28,482 units of ordinary shares to the general public on auction starting from June 22. Likewise, Api Finance Limited is selling 24,850 units of undersubscribed right share to general public on auction. The application is open till June 29.



Forecast



It is a little premature to confirm the continuity of the current surge. Moreover, retracements can be expected if supported by strong volume.

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