The market was boosted by foreign investors acting as net buyers, with value increased throughout the week, which helped the VN-Index to rebound.

The VN-Index on the Ho Chi Minh City Stock Exchange closed last week at 543.59 points, 4.75 percent higher, while the HNX-Index on the Hanoi Exchange rose by 2.87 percent to reach 72.79 points.

Excluding the extraordinary net selling of 214.5 billion VND (10.2 million USD) of Hanoi-listed Thieu Nien Tien Phong Plastics Company (NTP), foreign buyers were net buyers of shares valued at 872.3 billion VND (41.5 million USD).
On HCM City Exchange, foreign investors bought shares with a net value of 738.3 billion VND (35.15 million USD), mainly of Masan Group (MSN), Vietcombank (VCB), PetroVietnam Fertilisers and Chemicals Corporation (DPM) and Hoa Phat Group (HPG). Real estate giant Hoang Anh Gia Lai (HAG), however, witnessed strong net selling of 46.4 billion VND (22 million USD).

Also, strong buying from foreign investors helped boost market liquidity.

On the southern bourse, the trading volume averaged 102 million shares with an average trading value of 1.73 trillion VND (82.38 million USD). At the beginning of the week's trading, profit-taking occurred, causing many shares to lose. However, foreign buyers of PV Gas (GAS), Sai Gon Securities (SSI) and PetroVietnam Drilling (PVD) helped the VN-Idex to avoid losses.

Buying by foreign investors grew each trading session until the final trading day, with a focus on blue chips. On January 16-17, the VN-Index strongly increased with rates of 1.3 percent and 1.88 percent, respectively. Meanwhile, trading value jumped on January 17 to reach 2.32 trillion VND (1.1 billion USD) with many blue chips finishing at their ceiling prices, helping the VN-Index to reach the highest level since 2011.

Hoa Phat Group (HPG) saw the largest gain on the HCM City Exchange last week, increasing 17.2 percent thanks to the net buying of foreign investors with expectations for improved business results in the fourth quarter last year and for all of 2013.

Although the benchmark index strongly rebounded, the cash flow only targeted blue chips. Many speculative stocks encountered selling pressures, such as those of the real estate and construction sectors.
On the Hanoi Stock Exchange, the HNX-Index maintained its upward trend to January 16, though the trend was reversed on January 17 as the cash flow shifted to the southern bourse and speculative stocks lost their attraction.

With an average of 303.1 million shares changing hands, the average trading value was 598.6 billion VND (28.5 million USD). The northern bourse's liquidity remained at high levels.

According to FPT Securities, from the beginning of 2014 to date, foreign investors were net buyers on HCM City Exchange, with a net value of 803 billion VND (38.2 million USD). This was seen as a positive reaction to information about the increase in foreign stakes.

FPT Securities forecast that the VN-Index would continue to increase this week, as the cash flow would target blue chips, rather than speculative stocks.

Further, the Hanoi Stock Exchange lost its investors' attraction to the southern bourse and the HNX-Index barely maintained its upward trend.

At the beginning of last week, Deputy Prime Minister Nguyen Van Ninh asked the State Capital Investment Corporation (SCIC) to hasten disinvestments in sectors that did not require State holdings to enhance efficiencies, sending a positive signal to the market.

In 2014, many State-owned enterprises also planned IPOs, such as Viglacera, Vietnam Airlines and Vinatex, which helped boost supply of the equity market and attract more foreign capital.-VNA