Market comment – Aug. 6: Enthusiasm, necessary funds ready to push prices

What started out as a positive day ended in markets that were more or less unchanged. The technical glitch in Hanoi did have a rather positive effect on turnover (especially on HOSE) as the initial strong rise on good volume was followed by strong profit taking while investors realized that the strong performance in Hanoi was artificial.

Despite Thursday’s wild swing in the index, sentiment remains cautiously optimistic and Thursday’s volume certainly indicates that once momentum kicks in, the enthusiasm as well as the necessary funds are there to push prices higher with relative ease. The short term trend remains up, although some consolidation over the coming few days should not come as a surprise as the VN-Index has already gained some 3 percent since last Friday.

Almost all uncertainty – risk – about second quarter earnings is now out of the way and investors will soon start to focus on the current quarter and the rest of the year. And with a worldwide improvement in sentiment, we wouldn’t be surprised to see equity prices move higher over the coming weeks.

Johan Kruimer- Head of Brokerage at Ho Chi Minh City Securities Corporation (HSC)

thanhnien

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