Updated  
May, 21 2012 10:01:04

Fleeing investors depress exchange trade

HA NOI — Viet Nam's stock market witnessed the worst trading week since the beginning of this year with shares falling due to the "fleeing" sentiment of investors on both national exchanges.

On the HCM City Stock Exchange, the VN-Index lost 7.4 per cent over the course of last week, finishing Friday's session at 434.95 points.

Cautious psychology drove trading volume down 24.7 per cent, averaging over 90.4 million shares, worth VND1.45 trillion (US$69.2 million) per session.

In a week of steep decline, all 24/24 sectors gave up value, led by accommodation-entertainment group shares with an average loss of 12.5 per cent and those of the construction material and insurance sectors with a decrease of over 11 per cent each.

Sharp decreases of heavyweight stocks like Vietcombank (VCB) and insurer Bao Viet Holdings (BVH) further depressed the market. VCB, after listing over 1.78 billion additional shares on Monday and becoming the largest share in HCM City, fell during four out of a total five sessions, while BVH bottomed out four of its fifth declining session.

The VN30 Index which measures the top 30 shares by market capitalisation and liquidity also slid 1.79 per cent to stand at 504.61 points.

Heavy selling extended to foreign investors who unloaded a net VND404 billion ($19.2 million) worth of shares last week. Sacombank (STB) and Bao Viet Holdings (BVH) were the two codes sold the most heavily with a net sell of over VND64 billion ($3 million) for each code.

According to analysts of Sai Gon-Ha Noi Securities, there are two reasons why foreigners were net sells. First, they want to restructure their portfolios and put money in new shares such as PV Gas or BIDV, which are about to list later this year. Second, instability in the eurozone made them more cautious in investing in emerging markets, particularly when Viet Nam's stock market has continuously climbed since the beginning of this year.

"With the advantage of a stable economy, we still see Viet Nam as an attractive destination for foreign investors. But in the short term, heavy selling by this sector will have negative impacts on the market," they wrote in a research note.

Foreigners also were net sellers on the Ha Noi Stock Exchange last week, responsible for a net sell of VND2 billion ($96,000) worth of shares.

The benchmark HNX-Index was also down 6.4 per cent over the course of the week, closing Friday at 73.81 points. Daily trading volume also decreased 25.4 per cent to an average of over 72 million shares, worth VND737.8 billion ($35.1 million) a day.

After seven consecutive sessions of decline, most stocks were falling to reasonable prices that will likely stimulate speculative money in the short term, said an analyst of FPT Securities, Le Thi Bich Hang.

"However, to back the market uptrend, there should be stronger supporting economic news," Hang said, mentioning that the release of the CPI (Consumer Price Index) information in May was due this week.

She said the CPI could increase slightly in May, not a positive sign in the context of negative credit growth, which decreased 0.66 per cent by the end of April, also causing low GDP growth of just 4 per cent in the first quarter of this year. — VNS

Send Us Your Comments:
Name:
Your E-mail address:
Title:
 

VietNamNews may edit your comments and not all emails will be published.

Highlight

Chinese drilling rig pulled out of Vietnam's waters Chinese drilling rig pulled out of Vietnam's waters

At 6:30pm on July 16, China's oil rig Haiyang Shiyou – 981 was 41 nautical miles from its previous position and out of Viet Nam's exclusive economic zone and continental shelf, about 163 nautical miles southwest of China's Hainan island, reported the Viet Nam Coast Guard High Command.  

School closed for torturing autistic students School closed for torturing autistic students

City authorities have shut down an illegal school for autistic children after it was found to be torturing its students.

Teachers question city's proposal to use e-books 2    Teachers question city's proposal to use e-books

E-books would replace printed textbooks in the first to third grades in HCM City for the upcoming schools year under a new proposal, the vice chairman of the city People's Committee Hua Ngoc Thuan has said.

Beer plant left unfinished Beer plant left unfinished

A beer plant under construction in the centre of Ha Tinh City has become a pasture for local residents to graze oxen.

Noi Bai unveils first sleeping pods Noi Bai unveils first sleeping pods

Vietnam Airlines Tourism Company (VATC ) has installed the first ever sleeping pods in Noi Bai International Airport to serve the passengers.