Market to extend gains from last week

Stock indices have advanced, accompanied by steady increases in liquidity, and this is what investors expect to continue in both exchanges this week.
Stock indices have advanced, accompanied by steady increases in liquidity, and this is what investors expect to continue in both exchanges this week.

At the Hochiminh Stock Exchange, the benchmark VN-Index surpassed the five-year peak of 615 points recorded in October 2009 to close last week's trading at 620.14 points, acumulative rise of 2.63 percent during the week.

Blue chips gave the market a boost. PV Gas (GAS), the biggest stock in terms of market value, jumped 3.4 percent while large-cap shares such as VinGroup (VIC) posted substantial gains, along with Masan Group (MSN), Hoa Phat Group (HPG), PetroVietnam Drilling and Well Services Corporation (PVD) and Saigon Securities Inc (SSI).

The VN30 Index, which tracks the top 30 shares by market value and liquidity, also rose 1.52 percent to finish at 654.96 points.

Investors' confidence showed in the steady increases of money inflows into the market. Daily trading volume grew 40 percent over the previous week, averaging more than 139 million shares, while market value climbed 35 percent to reach nearly 2.94 trillion VND (139.3 million USD) per day.

On the Hanoi Stock Exchange, the HNX-Index also gained 1.35 percent to end at 83.34 points on August 22.

Trading also improved here, with market volume growing by more than 16 percent compared with the previous session, averaging nearly 62 million shares worth 791 billion VND (37.5 million USD) per session.

Analysts say profit-taking activity, particularly in oil and gas and securities shares, which saw impressive increases in the previous week, sparked the strong growth of liquidity on both exchanges last week.

They predict that the market rally will extend to this week, and investors could consider buying leading stocks in oil and gas, construction, real estate and securities groups.

One positive signal is that foreign investors ended their nearly two-week net selling streak on the Hochiminh market and returned as net buyers here in the last two sessions.

They were net buyers in term of volume (1.2 million shares) but were still net sellers in term of value, with a net sell value of nearly 50 billion VND (2.4 million USD). This was much smaller than their average net sales figures of 400-640 billion VND (19-30 million USD) in the last three weeks.

Dairy giant Vinamilk (VNM) topped foreign purchases last week, with 16.4 million shares worth 1.872 trillion VND (88.7 million USD) traded through negotiations. F&N Dairy Investment, Vinamilk's biggest foreign stakeholder, purchased more than 90 percent, or 15 million, of these shares.

It is believed that F&N bought 11.4 million of these shares from Dragon Capital and 3.6 million shares from VinaCapital, as these two funds registered to sell the exact amount of shares that F&N bought.

In Hanoi's market, the foreign sector was also responsible for a net sell value of 10.4 billion VND (500,000 USD).

"Foreign investors' comeback as net buyers will have a great influence on the market sentiment, especially at a time when the VN-Index comes near the next strong resistance," said Nguyen Van Quy, a stock analyst at FPT Securities Company.

But Quy said that for the Index to break through the 633-point threshold, the market needed a strong boost from macro-economic support information.-VNA

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