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Global fears weigh on indices
Indices fell on both domestic stock exchanges last week as investors continued to feel concern over the uncertainty of global markets.
On the HCM City Stock Exchange, the VN-Index lost 0.29 per cent from the previous week's close to end Friday's session at 503.65 points. Trading volumes and values also each declined by about 21 per cent, with an average of only 42 million shares changing hands per day, worth an average of VND1.2 trillion (US$65 million).
On the Ha Noi Stock Exchange, the HNX-Index dropped by an even more substantial 1.25 per cent on the week to a close on Friday of 158.39 points. Daily trading volume also dropped by over 25 per cent to reach 30.7 million shares, worth an average of just over VND1 trillion ($52.6 million) per day.
FPT Securities Company analyst Tran Duy Ngoc said that, while falling indices suggested investor caution, "the impact of global slumps, particularly the decline of the Dow Jones, on the Vietnamese stock market has been lessening."
Increased buys in the final minutes of each session last week helped cushion the fall of the VN-Index, as investors hoped to take advantage of cheap shares, Ngoc said.
Meanwhile, favourable information about inflation, economic growth, exports and the pending lowering of lending interest rates last week all had a positive impact on investor psychology, Ngoc added.
Au Viet Securities Company analysts wrote in their weekly report that active buys of blue chips by foreign investors last week also helped mitigate the decline in the market.
Foreign investors were responsible for a net purchase of VND310 billion ($16.3 million) worth of shares on the HCM City market last week. Masan Group (MSN) was the share most sought by foreign investors, who were responsible for over a million MSN shares changing hands.
By contrast, foreign investors were net sellers on the Ha Noi market last week by a net total of nearly VND25 billion ($1.3 million).
Despite the global volatility, many market watchers believed that domestic economic indicators were favourable and that the Vietnamese stock market would see stronger performance in July.
The Director of Kim Eng Viet Nam Securities Co's Ha Noi branch, Nguyen Van Manh, said that improved second-quarter earnings by many listed companies as well as lowered borrowing costs in July would buoy the market this month.
"Many companies have announced their five-month corporate profits," Manh said, "and many have already met over half of their earnings goals for the whole year. But the market would unlikely see a big rising wave since there were still no signs of a growing inflow of investment capital into the stock market."
Nguyen Van Hung, Head of analysis for SME Securities Company, predicted that, in light of the depressing global context, the Vietnamese stock market would continue to tread water this week, with the VN-Index likely remaining in the range of 500-510 points.
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