|The Ha Noi Stock Exchange. Stock markets are expected to rebound this week after the portfolio of exchange-traded funds (ETFs) is restrcutured. — VNA/VNS Photo Minh Quyet
HA NOI (VNS) — The stock market is expected to rebound in the final week of March, due to the conclusion of the restructuring of the portfolio of exchange-traded funds (ETFs).
This is seen as an important factor to ease investors' concerns after a steep fall last week, prior to the release of the ETFs' portfolio review.
Shares on the two stock exchanges declined substantially last week, particularly on the HCM City Stock Exchange, where the majority of the EFT's trading occurred.
The benchmark VN-Index in the HCM City market lost a cumulative 1.8 per cent during the week, closing Friday's session at 575.44 points. Meanwhile, the HNX-Index on the Ha Noi Stock Exchange decreased 0.69 per cent to end the week at 85.13 points.
Blue chips were the main drag on the market, as the large-cap stocks, including Masan Group (MSN), PV Gas (GAS), Vinamilk (VNM), PetroVietnam Drilling and Wells Service Corp (PVD), Vietcombank (VCB) and Bank for Investment and Development of Viet Nam (BID), were frequently among the decliners that pulled down the market.
Further, the VN30, which tracks the top 30 shares by market value and liquidity, fell 2.13 per cent to finish Friday at 603.76 points.
Foreign investors also contributed to the market's setback. Although they concluded the week as net buyers, their selling focused on blue chips, which had negative impacts on the market sentiment.
Yet in HCM City, the foreign sector were net sellers with a small selling value of VND6.4 billion (US$299,000). Foreigners mostly purchased shares of confectionery Kinh Do Corp (KDC), with a net value of VND344.2 billion ($16.1 million), and Kinh Bac City Development Holding Corp (KBC), whose net value was VND277.1 billion ($13 million).
However, they unloaded many blue chips, such as MSN, with a net value of VND161.1 billion ($7.5 million); PVD with a net value of VND126.5 billion ($5.9 million); and Sacombank (STB) and VCB, with net values of some VND120 billion ($5.6 million) each.
However, the foreign sector were net buyers in Ha Noi, responsible for an increase of VND14.5 billion in shares.
Active foreign trading also pushed up overall liquidity on the markets. The trading volume in HCM City increased 16 per cent over the previous week, averaging nearly 110 million shares, worth almost VND2 trillion ($93.5 million) per session.
In Ha Noi, the market value also climbed 16.7 per cent to reach nearly 48 million shares per day, worth VND627.5 billion ($29.3 million).
"Currently, there is no negative signal that changes the view on the market outlook. The landmark 570-575 points is seen as a strong guide for the VN-Index and this area will attract inflows that support the market's recovery," analysts at VNDirect Securities Co wrote in a note.
According to analysts from Maritime Securities Co, it is unlikely that the market will continue to fall, allowing the VN-Index to rally this week, trading around 578-580 points, led by bank stocks which saw downward corrections in the previous weeks.
However, analysts also warned investors to watch fluctuations of blue chips, which were the main drag on the market in recent period.
According to data by the financial website vietstock.vn, yields of large caps declined in the past three weeks, from an average gain of 1.09 per cent in the week ending February 27 to a negative 0.9 per cent last week.
"If the large-cap group continues to plunge in the coming time, the risk of a steep fall will rise because this group has a strong influence on the index movement, as well as investors' sentiments," said Nguyen Quang Minh, head of the analysis division of Vietstock. — VNS