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Market edges up on US rally, corporate tax cut
Ho Chi Minh City stocks treaded water Thursday as the US rally and the government’s proposal to reduce corporate taxes buoyed sentiments to snap the losing streak.
The VN-Index closed at 308.6 points after a gain of 2.38 points, or 0.78 percent. Trading volume too was better as 10.8 million shares changed hands, a 21 percent increase over the previous day. Of the index’s 171 members, 87 gained and 50 lost.
Phan Anh Tuan, manager of investment analysis at the Hanoi-based Vincom Securities Joint-Stock Co. thought 300 was a solid support level for the index. Bloomberg quoted him as saying: “The market has repeatedly gone down near 300 points and recovered in the past seven trading days. It would help buoy investors' sentiment at the moment.”
“The problem is that only individual investors are active in the market now. Without institutional investors' participation, the market will not have a big impetus for a sustained rebound.”
The Dow Jones Industrial Average rose 2.05 percent and the Nasdaq composite added 2.94 percent, while the Standard & Poor's 500 advanced 2.58 percent, according to AFP. The gains came despite an official report showing the US private sector lost 250,000 jobs last month, the largest fall since 2002.
The government could reduce corporate taxes and extend deadlines for tax payments to help companies cope with an economic slowdown, Minister of Finance Vu Van Ninh said in a report on the government's website.
The government may offer a 30 percent tax break in the fourth quarter and in 2009 for small- and medium-sized businesses, Ninh said. Companies will be given six to nine months to pay taxes and their income tax rate will fall from 28 percent to 25 percent on January 1.
Saigon Thuong Tin Commercial Joint Stock Bank remained the most active stock by volume Thursday, with 1.5 million shares. The HCMC-based bank, with 10 percent stake held by ANZ, lost VND100, or 0.51 percent, to close at VND19,600.
Saigon Fuel Co. was the best performer, gaining VND2,300, or 4.98 percent, to close at VND48,500. The firm announced on the exchange’s website it will pay a dividend of 10 percent and issue bonus shares at the rate of one share for every 10 held.
Hai Phong Paper Joint Stock Co. was biggest loser, declining VND1,900, or 10.8 percent, to close at VND15,700 as it went ex-dividend Thursday. The paper maker said it would issue bonus shares at the rate of 15 shares for every 100 held.
Foreign investors remained net sellers, notching up a negative figure of VND55 billion (US$3.3 million).
Hoang Uy
Thanh Nien, Bloomberg
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