NEPSE Declines Again, But Hydropower Stocks Attract Investor Interest — Market Stuck in Sideways Trend

The NEPSE index continued its downward trajectory on Sunday, the first trading day of the week. It dropped by 11.06 points, closing at 2,629.89. This marks the continuation of a bearish streak that has persisted over the past several sessions.

Despite the broader market weakness, investor activity was notably high in certain hydropower companies such as Radhi, Universal Power, Ngadi Group, and Butwal Power, though analysts caution that this interest is not yet strong enough to reverse the market's overall direction.

Sideways Trend and Rising Turnover: Mixed Signals

NEPSE has been fluctuating between 2500 and 2800 points for the past several months, which technical analysts interpret as a sideways trend, leading to increased uncertainty among investors.

Interestingly, despite the index drop, the total market turnover increased significantly to over NPR 9.13 billion. More than 2 crore (20 million) shares were traded in over 86,000 transactions involving 313 listed stocks. However, the combination of a declining index and rising turnover is being viewed negatively by many investors.

Hydropower Leads in Turnover

• Radhi Power: NPR 720 million

• Universal Power: NPR 620 million

• Ngadi Group Power: NPR 615 million

Some stocks, like River Falls Power and Pure Energy, even hit positive circuit levels, while Chilime Hydropower and Chhyangdi Hydropower saw an 8% rise in share prices.

On the flip side, Om Megashree Pharmaceuticals plunged by 10%, marking the day's sharpest decline.

Sector Performance Summary

Out of 13 sub-indices:

• 11 sectors declined,

• 2 sectors gained,

Key highlights:

• Hydropower: >1% gain

• Hotels & Tourism: slight recovery

• Banking: biggest loser, down 1.05%

Technical Analysis Insight

The NEPSE index is currently sitting on a long-standing trendline that has acted as support five times in the past few months.

• If the index holds this line, a rebound is possible.

• But if it breaks below this level, a triple-bottom formation could signal a more serious decline and trigger panic selling.

• The Relative Strength Index (RSI) is around 42, indicating a neutral zone.

Tomorrow’s session will be critical to determine whether this support line holds or breaks.

Top Broker Activity

Looking at the 10 top-performing brokers:

• 5 brokers had more buying than selling,

• 5 brokers sold more than they bought.

The top trader, Broker No. 58, recorded total transactions worth NPR 1.12 billion, with:

• Buying: NPR 529.8 million

• Selling: NPR 593.3 million

• Buy/Sell Ratio: 0.89

The overall market remains uncertain and range-bound. While the rise in hydropower stocks and turnover offers glimmers of momentum, it’s not yet a definitive trend reversal. All eyes are now on the next trading session, which will decide whether NEPSE holds its support or breaks down, potentially sparking panic behavior among traders.