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Confidence offsets profit-taking
Growing investor confidence helped offset profit-taking on the HCM City Stock Exchange last week, allowing the VN-Index to reach 480.65 points at the closing bell on Friday, a gain of 2.98 per cent over the previous week.
Average trading volume per session last week was 2.14 per cent lower than in the previous week, at 44.32 million shares, worth an average of VND1.7 trillion (US$95.5 million) per day.
Sacombank (STB) was the most active share of the week, with a total volume over the five trading days of 31.7 million shares.
On the Ha Noi Stock Exchange, the HNX-Index felt stronger pressure from profitakers, closing down 1.44 per cent on the week to 151.7 points, as major shares like Vinaconex (VCG) and Sai Gon-Ha Noi Bank (SHB) declined. SHB, in particular, lost 9.48 per cent of its value over the course of the week.
Daily trading value on the northern bourse also dropped 19.1 per cent from previous week to VND668.1 billion ($37.5 million), on an average volume of 20.55 million shares. Vinaconex (VCG) was the most active share on the week, with a total of 12.7 million traded.
"The different moves in HCM City and Ha Noi were basically due to the quality of listed firms on each market," said FPT Securities Co analyst Nguyen Binh Duong.
He noted that VCG was hurt by the Government insisting on an additional VND900 billion ($50.6 million) worth of capital that Vinaconex raised in its initial public offering be paid into the State budget. SHB prices, meanwhile, were depressed by the bank's listing of 150 million additional shares.
The HCM City market, meanwhile, saw enhanced investor confidence, boosted by positive moves on global market and solid net buys by foreign investors during most of last week, said Duong.
Foreign investors were net buyers on both stock exchanges last week, picking up a combined 3.5 million shares, worth VND354.55 billion ($19.9 million). They most favoured real estate developer Hoang Anh Gia Lai (HAG) and freight forwarder Gemadept (GMD) on the HCM City market, while buying Kinh Bac Urban Development (KBC) and PetroVietnam Insurance (PVI) in Ha Noi.
"It's notable that investment is now cycling in certain business sectors," Duong added, pointing to shares in publishing and educational equipment had begun to rise just at the onset of back-to-school season.
"Investors are now following a new tactic, targeting each business sector in each period at a time when the market has no other significant stimulus," agreed independent analyst Nguyen Anh Dung.
"The phenomenon began with real estate stocks, has moved to shares in publishing and educational equipment, and is likely to next be seen in food and confectionary stocks in expectation of their rising pre-holiday sales and profits in the third quarter".
Friday's session, in which the VN-Index lost ground after four straight days of gains, signalled the possibility of a short-term adjustment, as well as the continued, if less obvious, activities of day traders.
Duong believed the markets were becoming increasingly linked to happenings on global markets and on news about the economy.
"Global markets will swing around next week, which should be reflected in domestic trades," he said, forecasting the VN-Index to range between 455 to 495 points.
On the unlisted public securities market, the UPCoM-Index last week rose 10.43 per cent to close on Friday at 84 points, with an average volume per day of just 113,100 shares, worth a paltry VND1 billion ($56,179).
"Higher potential stocks would help increase the liquidity of this market," said Dao Van Khanh, an analyst with a Ha Noi-based brokerage.
"But enterprises seem to be standing outside, afraid of the strict listing regulations of this market."
Major over-the-counter (OTC) shares like Sabeco or Eximbank had set plans in motion to list on UPCoM in the near future, Khanh noted, suggesting that firms already listed on UPCoM enhance their investor relations effort in advance of an eventual rally on this market.
vietnamnet, vietnamnews
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