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Index down slightly as volumes hit record level
The VN-Index yesterday slid 1.18 points, or 0.34 per cent, to close at 350.14, as trading volume soared to a record high on the HCM City Stock Exchange.
Volume tripled from Tuesday’s session to nearly 75 million shares for a total turnover of VND2.3 trillion (US$127.8 million).
Sacombank (STB) regained its position as the most active on the southern exchange with 14.5 million shares changing hands, followed by Sai Gon Securities Inc (SSI) and Cables and Telecom Materials (SAM) with about 5.8 million shares traded each. Foreign investors contributed significantly to yesterday’s volume, with 16.5 million shares traded. They were net buyers of up to 12.4 million shares, worth VND465 billion ($25.8 million).
"The domestic economy showed positive signs and many firms are still posting satisfactory first-quarter business results and supporting market gains, although the general situation is still difficult," said Pham Linh, general director of Viet Nam International Securities.
The domestic economic situation saw "progress in most aspects" in April, with monetary and credit activities recovering, said Prime Minister Nguyen Tan Dung at a regular Government meeting earlier this week.
Many investors assumed that share prices wouldn’t slump as deeply as they did last year and purchasing power increased strongly as a result, Linh said.
Market liquidity for the rest of the week was likely to be lower than yesterday, the director said, as many investors were satisfied with their buys yesterday.
"Taking into account the current context of the domestic economy and its rally prospects in the second and third quarters, there is a basis for a stock market recovery," said Nguyen Trong Nghia, investment consultancy director at Thang Long Securities Co.
"However, too hot a recovery will not correctly reflect the economic picture," Nghia said, adding that it was reasonable that the VN-Index ranged between 320 and 360. In the short term, the domestic exchange was still feeling the impact of the world market, which was facing some "unknowns" – including the development of the H1N1 flu outbreak and the questionable health of the US banking system, he said.
Dau tu Chung khoan (Securities Investment) newspaper quoted investment director at France’s Jaccar Investment Fund, Khong Van Minh, as saying, "I don’t think that the [domestic] market is developing too hot" as negative economic developments were reflected in share prices at the end of last year. "Now, the stock market is reflecting expectations for the future," he said.
Nghia said it was likely that the market would see "big waves" in the second and third quarters, which would be "great opportunities for those who stay [in the market] and observe the game".
The next few weeks would also be a good time for long-term investors to disburse, he said.
The Ha Noi bourse tracked southern market gains yesterday, as the HASTC Index dropped 3.19 points to end the day at 124.4, a loss of 2.5 per cent. Trading volume increased 67 per cent to nearly 40 million shares with a total value of VND1.1 trillion ($61.1 million).
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