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Shares rebound on announced end of bank liquidity crisis
The VN-Index returned to positive territory on Wednesday, gaining 1.26 percent to close the day at 507.32 points.
The value of trades on the HCM City Stock Exchange remained at about VND1.5 trillion (US$78.9 million) on an overall volume of 37.3 million shares. Sacombank (STB) returned to its position as the most-active share, buoyed by its annouced plan to increase charter capital to over VND9 trillion ($473.7 million).
Nguyen Thai Hoa, a broker with a HCM City-based securities firm, said that a statement by State Bank of Viet Nam Governor Nguyen Van Giau early yesterday that commercial banks currently had about VND30 trillion ($1.6 billion) in disposable capital available, helped lift the spirit of domestic investors as well as boost banking and financial shares during yesterday's trading.
Giau's statement not only signalled an end to the bank liquidity crisis but also raised the prospect that credit would soon be used for securities investment, Hoa said.
"Investors are waiting for the opportunities they enjoyed with leveraged investments last summer," he added.
At the Ha Noi Stock Exchange yesterday, the HNX-Index closed up an even more impressive 2.9 percent to 170.22.
Trading became busier, generating a turnover of VND1.1 trillion ($57.9 million) on a volume of 32.9 million shares. Kim Long Securities Company (KLS) continued its impressive showing, racking up a volume of 5.8 million trades.
John Harackiewicz, an analyst with Sacombank Securities Company, pointed to global market movement as providing a positive background for domestic markets yesterday.
Foreign investors returned to being net buyers again yesterday on the HCM City market, picking up a net of nearly 300,000 shares.
"Technically, the VN-Index is bouncing off that support as we expected on decent volume," Harackiewicz said, noting that Tuesday's losses were too small to affect opening prices yesterday and that share prices remained above support levels.
"Our technical analysis suggests that from the long-term perspective and current market conditions, the risk-reward ratio is favourable," said Harackiewicz. "And in the short-term perspective, the situation is now bullish".
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