Shares to climb amid injection of foreign capital

March 13, 2023 - 09:42
On the Hồ Chí Minh Stock Exchange (HoSE), the VN-Index lost 0.28 per cent to close Friday at 1,053.00 points.
Đất Xanh Group (DXG)'s headquarter in Bình Thạnh District, HCM City. Đất Xanh Group (DXG)'s stocks rose 11.4 per cent last week. Photo

HÀ NỘI The market will continue its recovery trend thanks to receiving supportive information, in which a huge amount of capital from foreign investors will be disbursed in the next 1-2 weeks.

On the Hồ Chí Minh Stock Exchange (HoSE), the VN-Index lost 0.28 per cent to close Friday at 1,053.00 points.

Đinh Quang Hinh, head of the Macro and Market Strategy Division of VNDIRECT Securities Joint Stock Company, said that the market had just experienced a more positive trading week than expected thanks to the appearance of some supportive information.

The Government promulgated Decree No.08/2023/NĐ-CP dated March 5, 2023, amending, supplementing and suspending a number of articles in Decree No.65 regulating the private placement of corporate bonds in the domestic market and to the international market.

This would help to remove some bottlenecks in the corporate bond market. Receiving this news, cash flow had poured into real estate stocks at the beginning of last week and helped the stock indexes prosper, Hinh said.

The news that the foreign fund Fubon ETFs was approved to increase capital and China had put Việt Nam on the pilot list to open group tourism from March 15 has reinforced the positive sentiment of the market.

This week, important information will come from the restructuring of the portfolio of foreign ETFs, VNM ETF and FTSE ETF as well as the disbursement of Fubon ETFs after a successful fundraising.

VNDIRECT expects that foreign capital inflows will be poured strongly this week and will be a factor to keep the market's uptrend.

It is estimated that VNM ETF and Fubon ETF can net buy more than VNĐ6 trillion on the Vietnamese stock market in the next one to two weeks. In that context, the VN-Index may maintain the recovering trend and head towards the old resistance zone around 1,070 - 1,080 points.

In the process of going up, the market may have shaking sessions due to the impact of concerns about the US Federal Reserve (Fed) tightening monetary policy in the upcoming meeting. However, the recovery trend will still be dominant.

Investors may consider increasing the proportion of stocks in short correction spans of the market. At the same time, priority should be given to disbursing funds to stocks with supporting stories such as large net-buying by passive investment funds (ETFs), stocks benefiting from China's opening up, and public investment.

“Early this week, VN-Index may retest the support zone of 1,040-1,045 points before advancing again towards the end of the week," said Bảo Việt Securities Co. "The index's resistance zones are at 1,072-1,082 points and 1,120-1,125 points.”

“Investors may consider opening long positions when VN-Index retreats to the aforementioned support zone. Focusing on themes such as public investment, China's reopening, large-cap stocks in the VNM ETF and Fubon ETF portfolio, and other stocks such as securities, steel, maritime transportation."

After weeks of divergence, banking stocks all gained with VPBank (VPB) up 7.7 per cent, Vietinbank (CTG) up 5 per cent, Bank for Investment and Development of Vietnam (BID) up 2.7 per cent and Vietcombank (VCB) up 1.3 per cent.

After several consecutive weeks of decline, the real estate industry recovered last week thanks to positive news related to Decree 08 on corporate bond issuance. This helped many real estate codes gain such as Đất Xanh Group (DXG) up 11.4 per cent, Khand Điền House (KDH) up 8.8 per cent, Vinhomes (VHM) up 4.6 per cent, and Nam Long Group (NLG) up 1.2 per cent.

Steel shares also rallied last week in the context that the steel industry is expected to recover thanks to the Government's boost in public investment and recovery in demand in China. Accordingly, Nam Kim Group (NKG) jumped up by 8.8 per cent, Hoa Sen Group (HSG) increased by 7.2 per cent and Hòa Phát Group (HPG) rose by 4.7 per cent. VNS