Despite gains on Dec. 16, shares closed down last week on both of the nation's stock exchanges.

On the HCM Stock Exchange, the VN-Index lost 2.95 percent from the previous sesion's close, ending the week at just above 366 points. The average daily volume of trades increased 3 percent over the previous week to about 47.3 million shares, worth 721 billion VND (34.3 million USD) per session.

On the Hanoi Stock Exchange, the HNX-Index also fell by over 3 percent, finishing the trading week at 59.83 points. Volume also declined by 9.5 percent, averaging about 30.7 million shares worth 255.6 billion VND (12.2 million USD) per day.

Ongoing declines on both exchanges aroused speculator appetites for cheap shares late in the week. A rally on Friday brought to a halt eight successive sessions of declines in HCM City and five consecutive falling sessions in Hanoi .

Foreign investors last week reverted to being net buyers after several weeks as net sellers, helping stimulate the interest of local investors. Foreign investors were responsible for a combined net buy of nearly 145 billion VND (6.9 million USD) worth of shares on both stock exchanges.

Financial and securities stocks were still largely favoured, with Sacombank (STB), Sai Gon Securities Inc (SSI), Sacombank Securities (SBS), Kim Long Securities (KLS) and VNDirect Securities (VND) among the most-active shares on both exchanges.

Although trading improved towards the end of the week, there were signs that many small investors had begun to leave the market, as the volume of trades by order-matching trades declined substantially even as the volume of negotiated trades soared. The volume of negotiated trades in HCM City last week skyrocketed by over 159 percent to 89 million shares, the volume of negotiated trades in Hanoi climbed 79 percent to nearly 20.3 million shares.

The liquidity problems of SME Securities Co continued to be a hot topic over the past week. The company's cash has dried up and investors who wanted to withdraw money were told to wait two or three weeks.

Information that Dong Duong Securities Co had transferred all of its investors to Kim Eng Securities Co and Hanoi Securities Co and stopped delivering brokerage services further fuelled investor concerns over the possibility of the insolvency of another small brokerage.

Overall, apart from efforts by bottom feeders to hunt down bargain shares and the rising demand of foreign investors, the market trend remained downward.

"Investor psychology remains pessimistic and cautious toward released information," FPT Securities Co analysts wrote in a report. "Cash flows into the market are still limited by uncertainty and negative information."

Bao Viet Securities Co analyst Pham Van Khoa said this was the time of year when funds were restructuring their portfolios to boost net asset value (NAV) on end-of-year reports. However, Khoa said, the impacts could be insignificant as many institutional investors had already bought or sold according to their investment strategies./.