Nepal Stock Market Declines Over 10 Points on the Second Trading Day of the Week, NPR 8.92 Billion Turnover, Momentum in Hydropower While Development Banks Face Pressure

Nepal's stock market continued its decline on Monday, marking the second consecutive trading day of losses. The NEPSE index dropped 10.61 points, closing at 2,633.32. The total turnover for the day stood at NPR 8.92 billion, with over 17.2 million shares of 312 companies traded.

Top Performers

• Sindhu Bikas Bank recorded the highest transaction value of NPR 298.3 million.

• Saptakoshi Development Bank ranked second with a turnover of NPR 186 million, followed by NRN Infrastructure and Development Bank with NPR 120.9 million.

Although five sector indices showed gains today, the overall NEPSE index could not avoid a decline. Experts attribute this to ongoing market corrections and sideways trading patterns, limiting the index's momentum.

Key Market Insights
Some analysts have cited reduced profits in banks and lower dividend payouts by listed companies as the primary reasons for the market's decline, which has weakened investor confidence. However, other experts view this drop as a normal correction.

On a positive note, recent developments such as new leadership at the Securities Board of Nepal, the inclusion of SME companies, and the final stages of the new stock exchange licensing process are seen as long-term growth drivers. Additionally, improvements in liquidity within the banking system and declining interest rates are expected to support a slow market recovery.

The NEPSE index remains in the 2,400–2,700 range, which has persisted for the past six months. Analysts are optimistic about a potential recovery in the near future, provided macroeconomic conditions improve.

Technical Analysis

The NEPSE index is currently trading between 2,581 (support) and 2,669 (resistance). The chart reflects patterns of higher lows and lower highs, indicating market uncertainty. Technical analysts suggest that if the index sustains above the current price channel, it could target 2,700 in the short term. However, a break below 2,581 could lead to further declines. The market appears to be in an accumulation phase, signaling possible long-term recovery opportunities.

Sector Heatmap

A heatmap based on trading activity shows significant momentum in the hydropower and finance sectors:

• Nyadi Hydropower demonstrated strong performance, lifting the hydropower sector.

• The finance sector saw stable contributions from companies like SLBSL and MPL.
  In contrast, development banks and non-life insurance sectors underperformed.

• Heavy declines in Saptakoshi Development Bank dragged down the development bank sector.

User-Created Technical Charts

Several users on the platform contributed valuable technical charts today:

• Nirajan analyzed SPC, recommending a buy between 590–600 and a sell at 700.

• Roshan Bhandari analyzed TVSCL, projecting potential growth based on its recent trends.

• Raj provided an in-depth analysis of NRM, highlighting key technical patterns.

Broker Analysis

An analysis of today’s top 10 brokers reveals mixed activity:

• Four brokers (57, 17, 44, and 56) showed higher buying activity.

• Six brokers (58, 34, 45, 42, and 49) demonstrated higher selling activity.

• Nyadi Hydropower saw 31% purchases by broker 56.

• SBI Bank recorded 77% of its total purchases by broker 34.

• Mountain Energy Nepal had 64% of its total sales through broker 58.

• Sanima Mai Hydropower witnessed 37% sales by broker 45.

This mixed activity across brokers and sectors reflects the dynamic nature of the market, emphasizing the importance of strategic decision-making for investors.