Inflation fears scream back

Total trading value fell to VND1.6 trillion ($77.3 million), the lowest level in the past two weeks. Among them, Ho Chi Minh Stock Exchange (HoSE) saw 66.4 million shares worth VND1 trillion ($48.3 million) changing hands, while Hanoi Stock Exchange (HNX) liquidity sunk to 55.9 million shares worth VND611 billion ($29.5 million).

Right after the consumer price index (CPI) was reported to be low, the government allowed petroleum traders to increase fuel retail prices last Friday. That move largely worried investors as CPI is still under pressure of basic salary increase and a possible electricity price hike in May.

“Inflation expectations may rise again, as fiscal policy seems to focus now more on budget revenue collection and monetary policy is in a easing mode to avoid a further declines in economic growth,” said Saigon Securities Inc. (SSI) in its note to clients.

Even a lower CPI for the whole nation reported this morning could not encourage investors. Demand for shares was weak, while the market largely expected a negative trend in short-term.

HoSE’s VN-Index slipped 0.55 points or 0.12 per cent to end at 465.17 points. Pillar stocks Bao Viet Holdings (BVH) and Masan Group (MSN) fell, along with some large-cap stocks like FPT Corp. (FPT), Sacombank Securities (SBS) and Vietinbank (CTG).

A mass of cheap speculative stocks like Ninh Van Bay Real Estate (NVT), Viet Nam Petroleum Transport (VIP), PetroVietnam Transportation Corp. (PVT), Vietnam Mechanization Electrification and Construction (MCG) were also strongly sold.

“Even a rebound in the VN-Index tomorrow will probably a bulltrap,” said VNDirect Securities (VND) in its note to clients. “The buyers prove highly hesitant, with liquidity sharply dropped to half of its peaks in April 18 and 19’s sessions,”

On the other hand, a number of investors still took advantage of the market fall to buy in. Mineral stocks like Tay Bac Minerals Investment (KTB), Binh Thuan Hamico Mineral (KSA), Binh Duong Mineral and Construction (KSB), Nari Hamico Minerals (KSS) massively hit the ceiling with big bidding volumes.

HNX speculative stocks still rallied, among them Sacomreal (SCR), Trang An Securities (TAS), Thai Hoa Vietnam Group (THV), among with Licogi 13 (LIG), Locogi 16.6 (LCS).

HNX-Index ended up 0.06 points or 0.08 per cent to close at 77.81 points.