Market yet to break barrier

The VN-Index today corrected after three consecutive trading sessions to close at 459.26 points, down 2.79 points or 0.6 per cent, while HNX-Index also shed 0.93 points or 0.76 per cent to 121.69 points.

Trading volumes and values on both bourse also decreased with only 30.5 million shares and VND780 billion ($40 million) on the HoSE and 24.2 million shares and VND578 billion (29.6 million) on the HNX changed hands, compared to 37.4 million shares worth VND983 billion ($50 million) and 23 million shares and VND539 billion ($27.6 million) traded respectively on the previous day.

Foreign investors remained net buyers of Vietnamese stocks today, but with fewer stock and values, respectively at 1.34 million shares and VND85 billion [bought four million shares and VND153 billion and sold 2.67 million shares and VND68 billion), compared to over 6.69 million shares [bought 11.5 million shares and sold 4.77 million shares) on October 7.

While the domestic investors still kept cautious views on the markets’ outlooks, market analysts said the lower trading of foreign investors and the plunge in most blue chips were the reasons behind today’s market correction.

“The sudden increase in the trading values of foreign investors in recent sessions has brought a big question to many investors. However, the purpose and the ability to maintain strong bid are still left unknown,” said Tran Thi Hai Yen, Bao Viet Securities’ senior analyst.

Most blue chips like insurance stocks BVH, technology giant FPT, steel maker HPG, infrastructure developer ITA and property developer KBC which were heavily bought by foreign investors plunged today, especially BVH closing floor after three sessions hitting ceiling. 

“The market move, which depends too largely on some large caps BVH, MSN and DPM [heavily bought by foreign investors], prove the unsustainable bullish,” said Le Anh Thi, Au Viet Securities’ investment director.

Yen said the market picked up in the last three sessions mainly on bidding from foreign investors rather than any remarkable support from domestic investors, which can be seen in the average trading volumes of the market. However, if foreign investors’ bid volumes were sustained, the market would likely recover soon.

On the HoSE today, 162 stocks fell, 48 rose and 51 unchanged. DPM was the market’s top traded stock with 1.51 million shares changing hands, followed by SBT and ARG with 1.45 million and 1.04 million, respectively.

On the HNX, 238 stocks fell, 56 rose and 18 closed flat. Three financial stocks PVX, brokerage KLS and HBS recorded trading volumes of more than one million shares today, of which over two million PVX shares changed hands. Closing October 8, PVX fell VND400 to VND22,300 a share.

In general, Yen added that investor sentiment had not improved in the context of strong swings of gold price and the forex markets. Gold price sustains at VND33 billion a tael yesterday before settle down to around VND32.5 million a tael today. Complex gold price movements have imposed remarkable risks to exchange rate stability. The dollar buying price in the free market and the interbank market has surpassed 19,700 VND/USD.

“We maintain our view that exchange rate will be the biggest risk to the stability of Vietnam’s macro-economy in the last several months of the year,” said Yen.