The benchmark VN-Index on Wednesday regained the 1,100-point landmark after falling to a two-year low, but low liquidity may threaten the market recovery in the next sessions.
On the Ho Chi Minh Stock Exchange, the VN-Index jumped 2.42 per cent to close at 1,104.26 points. The southern bourse’s index lost nearly 5 per cent in the previous two sessions.
On the Ha Noi Stock Exchange, the HNX-Index also leapt 2.76 per cent to end at 242.12 points. The northern market's index had lost nearly 6 per cent in the past two days.
|Vincom Pham Ngoc Thach in Ha Noi. Vin shares contributed most to the VN-Index's growth yesterday. VNS Photo Mai Huong |
According to analysts, today's strong gains have partly relieved investors' anxiety after a series of deep declining sessions.
Blue chips again led the market upturn.
Twenty-seven out of the VN30 basket, which tracks the top 30 shares by market value and liquidity on the HCM City's bourse, gained value, of which Vin shares contributed most to the VN-Index's growth. Vinhomes (VHM) jumped 6.3 per cent while Vingroup (VIC) rose 5.3 per cent and Vincom Retail increased 1.1 per cent.
Banking shares also recovered strongly. Only Asia Commercial Bank (ACB) sank in the red and two – Ho Chi Minh Development Bank (HDB) and Saigon Bank (SGB) closed flat, another 25 lenders posted growth, of which Eximbank (EIB) hit the daily trading day limit of 7 per cent, Vietinbank (CTG) up 6 per cent; BIDV (BID), Military Bank (MBB) and Sacombank (STB) each were up by over 2 per cent.
Liquidity declined, however, as just 505 million shares worth VND10.4 trillion (US$824.5 million) were traded on both exchanges, down 21 per cent in volume and 14 per cent in value. However, market analysts have attributed such a decline to lower selling pressure as investors now do not rush to sell shares at a very low price.
According to Viet Dragon Securities Co (VDSC), although the market rebounded from the support area of 1,080 points of the VN-Index and 1,100 points of the VN30-Index, the weakening movement from the previous sessions continued to weigh on the market, and the supply pressure still influenced the market, while the supportive cash flow stayed conservative.
"It is predicted the market still faces many difficulties. Therefore, investors still need to be cautious, keep the portfolio safe, and wait for the following supportive action in cash flow," Phuong Pham, VDSC's analyst, wrote in a note.
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