VN-Index up on investor confidence

Hanoi (VNA) - The benchmark VN-Index surpassed the short-term resistance of 780 points on July 6, closing up 0.56 percent at 782.65 points, thanks to strong investor confidence in the market outlook.

This is the highest landmark since early 2008. The key index on the HCM Stock Exchange has expanded over 17 percent since the beginning of this year.

On the Hanoi Stock Exchange, the HNX-Index rose for a third day, adding 0.67 percent to close the July 5 session at 102.60 points. The northern market index has soared over 28 percent compared to the end of 2016.

Investors were solid on the market outlook and increased capital flows in the markets.

A total of 341 million shares worth a combined 4.9 trillion VND (216 million USD) were traded on the two markets, up 18.8 percent in volume and 11.4 percent in value compared with the previous session.

Money shifted focus on penny and medium-cap stocks. Shares of Tan Tao Investment and Industry (ITA), Hoang Quan Consulting-Trading-Service Real Estate (HQC), HAI Agrochem (HAI) were still among the most purchased on the HCM Stock Exchange.

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Among these stocks, ITA hit the daily maximum rise of 7 percent allowed on the HCM City market for a third day, settling at 4,940 VND a share. The shares have gained value for nine of the last 10 sessions with a total growth of 45.7 percent following the result of its annual shareholders’ meeting on June 26.

At the meeting, ITA announced its ambitious business targets for 2017, of which total revenues will likely reach 880.4 billion VND and net profit of 309.2 billion VND, a rise of 160 percent in revenue and 700 percent in profit compared to 2016’s performance.

Besides, many low-priced shares also received large investments including real estate developer An Duong Thao Dien (HAR), Vicem Hai Van Cement (HVX), Lao Cai Mineral Exploitation & Processing (LCM), and Agribank Securities Co (AGR) which hit the daily limit gain.

For large-cap stocks, energy firms were among the biggest gainers with PV Gas (GAS), Petrolimex (PLX) and Petrolimex Gas Corporation (PGC) adding up 1 percent, 3.2 percent and 3.6 percent, respectively.

According to analysts at Maritime Securities Co, the market will likely face a downward correction after a strong rally.

“Cash has been moving to small- and medium-cap shares which may indicate the possibility of a short-term correction,” they wrote in a note and suggested a hold-and-buy strategy while considering profit taking of the stocks that have risen sharply.-VNA