Sluggish trades fail to derail market gains
HA NOI — Shares gained value over the course of last week on the HCM City Stock Exchange, with the benchmark VN-Index rising 1.22 per cent over the previous week, concluding Friday's session at 418.21 points.
Investors remained cautious, however, pushing the market volume down 42 per cent from the previous week's level, averaging just more than 25 million shares, worth VND404 billion (US$19.2 million), per session.
The market fluctuated in a narrow band with sombre trading, according to stock analysts' comments on the financial website vietstock.vn. They attributed the sagging liquidity to the lack of positive news during the week.
The decision to hike the petrol price by VND900 to VND21,900 ($1) per litre on Wednesday, though likely causing more difficulties to enterprises in the coming time, did not have a great impact on Index movements.
Only five out of a total 24 share groups posted gains last week, led by food and beverage firms with an average increase of 6.52 per cent. Dairy giant Vinamilk (VNM) was the largest winner with a rise of over 12 per cent over the week, boosted by news that the company plans to issue 278 million bonus shares to pay investors a rate of 2:1.
The company's first-half profit jumped 29 per cent year-on-year to nearly VND12.9 trillion ($614.3 million).
Foreign investors also increased buying last week, being net buyers on both exchanges, picking up a combined net buy of VND118.5 billion ($5.6 million) worth of shares.
Meanwhile, the benchmark HNX-Index on the Ha Noi Stock Exchange gave up 0.66 per cent over the week, closing Friday at 68.89 points on sluggish trading.
The volume of trades also decreased 43 per cent over the previous week, averaging 26.8 million shares, worth nearly VND357 billion ($17 million), per day.
"No factors that may boost the market have appeared at the time being. Low liquidity trading reflects investors' prudence, an attitude that is prevailing in the market," Nguyen Van Quy, FPT Securities Co's analyst, wrote in a weekly report.
Ninety out of a total of 609 companies having reported second-quarter business results posted losses. Nearly 100 firms have yet to file their reports but late announcers often report losses and the number of loss-making companies is forecast to be higher.
In addition, the country's total credits expanded by just 0.57 per cent to July 25, far lower than the annual target of 8-10 per cent. "GDP growth this year will likely be lower than that of last year," Quy said. — VNS