HÀ NỘI – The VN-Index declined for the first time in six weeks due to heavy profit-taking pressure, but analysts expect a rebound this week following the release of the second-quarter business earnings.

The benchmark index of the HCM Stock Exchange inched down 0.1 per cent after five sessions, closing Friday at 775.73 points.

Popular large-cap stocks that were the market engine early last week, like PV Gas (GAS), Vietinbank (CTG), Vietcombank (VCB), BIDV (BID), Hòa Phát Group (HPG), Sabeco (SAB) and Bảo Việt Holdings (BVH), all slumped towards the end of the week due to rising selling pressure.

The selling peaked after the VN-Index hit nearly 783 points in the weekend session, the highest since early 2008, and pulled the market down.

Since the beginning of this year, Việt Nam’s key stock index has gained about 17 per cent to become the top performer in the region, surpassing Thailand, the Philippines and Malaysia, which have received big support from foreign capital.

“Though the unexpected decline in the weekend session slowed down the VN-Index growth, the market condition was not negative and investors’ sentiment remained stable around 770 points,” analysts at BIDV Securities Co wrote in a weekly report.

An average of 229 million shares worth almost VNĐ4 trillion (US$176.2 million) were traded per session on the HCM City’s exchange, up 6 per cent in volume and 1 per cent in value compared to the previous week.

The stock indices are likely to rise again as investors bet on second-quarter earnings reports that will start coming out this week, as well as new growth-boosting policies of the Government, analysts have said.

Meanwhile, money is flowing into penny and medium-small caps. Many shares of these groups hit the maximum daily rise for several consecutive days and were among the most heavily-traded stocks.

These included Tân Tạo Investment and Industry (ITA), Hoàng Quân Consulting-Trading-Serive Real Estate (HQC), Ocean Group (OGC), An Dương Thảo Điên Real Estate (HAR) and HAI Agrochem (HAI).

Weekly expansion

On the Hà Nội Stock Exchange, the hub of small- and medium-cap stocks, the HNX-Index expanded 2.5 per cent for the week, ending Friday at 101.58 points.

Liquidity increased with an average of 81 million shares worth VNĐ785.4 billion traded a session, up 63.7 per cent in volume and 30.3 per cent in value compared with the previous week.

On Friday, the State Bank of Việt Nam issued Decision No 1424 and 1425, efective July 10, which reduces the discount rate and refinancing rate by 0.25 per cent and lowers the ceiling interest rate on short-term loans by 0.5 per cent for priority sectors.

This is the first time since 2014 the central bank made this move to support the Government’s growth targets.

“In the context of increasing liquidity of the banking system… this policy will continue backing liquidity of commercial banks as well as the stock market,” BIDV Securities Co. analysts said.

Việt Nam reported positive economic data in the first half of this year with the GDP growth reaching 5.73 per cent, higher than 2012-2014 and 2016 figures. Export and import values were up 18.9 per cent and 24.1 per cent year-on-year, respectively; and inflation was at below 5 per cent for a second year.

Analysts said the country’s stable economic growth was a solid foundation for attracting attract foreign capital, with an influx of VNĐ9.2 trillion ($409 million) recorded in the year’s first half. – VNS