Share prices at Nepse head for correction

KATHMANDU, December 29: Despite the retreating stock index, transaction volume stayed above Rs two billion for the third consecutive week, while share prices headed towards correction this week — December 22 to 26.

The benchmark index slumped by 18.28 points, that is 2.3 per cent, on the week’s trading, dropping to 787.07 points.

During the rally in the last two weeks, share prices had been inflated quite a bit, which led investors to sell shares. Profit booking by investors before the share price slump that increased the selling pressure pulled stock prices down.

At the same time, the declining prices at present following a rally has even attracted buying which helped sustain the weekly turnover of Rs two billion for the third consecutive week.

This week, Nepse’s floor witnessed trading of 5.37 million unit shares worth Rs 2.72 billion of 140 companies in 14,992 transactions. Transaction volume increased by 7.9 per cent in comparison to last week, while number of shares traded and transactions increased substantially.

Share trading of blue chip stocks belonging to class ‘A’ companies comprised 42.64 per cent of total transaction, amounting to Rs 969 million. The sensitive index declined by 6.33 points and float index also went down by 0.7 points to 52.29 points.

This week, insurance, hotels, manufacturing and development banks gained while banking, others, hydropower and finance companies ended up in the red.

Insurance was the highest earner of the week and gained 124.29 points as Nepal Life Insurance gained Rs 370 per unit, among others. Unilever’s share price increased by Rs 250 that pushed the manufacturing index up by 10.63 points. Likewise, hotels and development banks also gained 4.95 points and 8.6 points.

Banking was the biggest loser of the week as stocks of banks such as Nabil Bank and Everest Bank were down by Rs 121 and Rs 55, respectively. Hydropower was down by 23.43 points as Butwal Power Company and Chilime Hydropower lost Rs 64 and Rs 35 per unit, respectively.

Likewise, Nepal Telecom’s share price slumped by Rs 21 bringing the others subgroup down by 23.49 points. Finance companies also recorded a loss of 5.83 points.

This week, Nepal Bank topped the charts in terms of transaction volume with trading worth Rs 234.3 million. Nepal Bangladesh Bank was the forerunner in terms of number of shares traded with trading of 649,179 units. In number of transactions, Sana Kisan Bikas Bank was the forerunner with 1232 transactions.

The top five companies this week in terms of transaction volume were Nepal Bank (Rs 234.3 million), Nepal Bangladesh Bank (Rs 206.537 million), NCC Bank (Rs 114.603 million), NIC Asia Bank (Rs 104.6 million), and Sanima Bank (Rs 101.5 million). This week, 600,000 units of Himalayan Bank’s debentures and 1.3 million unit shares of two insurance firms were listed at Nepse.

(Source: THT)