The sole equity marketof Nepal experienced continuous decline throughout the week with the NepalStock Exchange (Nepse) index dropping 1.60 percent to close at 1,318.22 points.Sensitive index which accounts for the performance of Class 'A' stocks declined1.56 percent to 277.89 points. 

The week started offwith the benchmark index losing mere 0.46 points on the first trading session.However, further losses continued in the latter sessions with the indexwitnessing the highest drop of more than 10 points in the last tradingday. 

The stock marketexperienced a dismal trading week on the backdrop of parliamentary discussionson the government's plans and rumors regarding increment in taxes to be imposedon share transactions.

Nonetheless, total weeklyturnover rose by 77.71 percent to Rs 1,922 million against last week's Rs.1,081 million. More investors, compared to last week, can now enter into sharetransactions, having updated their Know Your Customer (KYC) details in brokeroffices. 

On the weeklytimeframe, most sub-indices slipped following the performance of broadermarket. Insurance Sub-Index dropped by the highest 2.44 percent to close at6,787.90 points. Banking Sub-Index also fell 2 percent to 1,124.37 points.Only, Microfinance and Trading Sub-Indices ended higher during the reviewperiod. 

Promoter's shares ofNepal Investment Bank Ltd were the most active stock for the week with a totaltransaction worth Rs 228.5 million. Secondly, shares of Swarojgar LaghubittaBikas Bank posted a turnover of Rs 69.97 million. The company is waiting forapproval from Securities Board of Nepal (SEBON) for the issue of 100 percentright shares. Furthermore, Laxmi Bank Ltd posted a turnover of Rs 58.33million. 

For the major news,Nepal Bank Ltd has proposed the price of its Further Public Offering (FPO) atRs 280 per share which is subject to approval from Securities Board of Nepal(SEBON). Earlier, its annual general meeting (AGM) had passed the decision toissue 17.68 million units shares in the respective issue. Furthermore, RairangHydropower Development Company Ltd concluded the allotment of its initialpublic offering (IPO) of over 76 million unit shares to general public thisweek.

With regards todividends, Butwal Power Company Ltd confirmed 20 percent cash dividend to itsshareholders from its earnings in the previous year. Citizens Investment TrustLtd also approved the distribution of 22.06 percent bonus share and 1.16percent cash dividend to its shareholders this week.

As per the ARKStechnical analysis, the stock market continued its correction in all tradingsessions of the week. The index faced continuous decline after it failed toclose above the resistance of 1,350 points in the first trading day. 

The index is alsolikely to test the support of 1,300 points in its downfall. We can expect abounce back of the index if the support manages to hold ground. 

However, both RelativeStrength Index (RSI) and Moving Average Convergence/Divergence (MACD) presentthat the bears still dominate the market making the downtrend continuation morelikely.

Source: MyRepublica 27^thMay 2018