HÀ NỘI – The Vietnamese stock benchmark VN Index came close to its new record high of 1,200 points last week on the prolonged rally of large-cap shares, and the uptrend is expected to continue in the coming five sessions.

The VN Index on the HCM Stock Exchange gained 0.57 per cent to end Friday at 1,199.96 points, totaling a three-day growth of one per cent and making a weekly gain of nearly 2.2 per cent.

The same pattern also occurred for the HNX Index on the Hà Nội Stock Exchange. It ended last week at 138.02 points, up two per cent after two days and total 4.2 per cent from the previous trading week.

An average of 304 million shares was traded in each of the past five sessions, worth VNĐ11 trillion (US$495.3 million). The trading figures were up 12 per cent in volume and 42 per cent in value as compared to the previous week.

High investor confidence amid a potential global trade between China and the US helped boost the local stock markets last week, spreading confidence across all sectors on the market.

Shares of securities firms, insurance companies, building contractors and property developers made good growth to provide a support for local indices.

Those gainers included Saigon Securities Inc (SSI), HCM City Securities (HCM), Bảo ViệtHoldings (BVH), Viet Capital Securities (VCI), Vingroup (VIC), Novaland (NVL) and HCM City Infrastructure Investment (CII).

Good growth of the key sectors on the stock market helped lift the benchmark VN Index by more than 22 points or 1.9 per cent on Monday to 1,196 points, approaching the 1,200-point landmark, and the benchmark was able to remain around that landmark after five sessions of last week.

According to analysts and brokerage firms, it appears unlikely that China and the US governments would let a trade war happen between their two biggest economies while all statements of the two governments have only meant threats to each other.

“We still believe that recent moves of the US and China aim at taking advantage before entering into formal negotiations rather than waging a trade war, which could result in great losses for both economies,” Bảo Việt Securities Company (BVSC) said in its weekly report.

However, the problem between the two giant would remain “a potential risk factor” that could have “significant impact on global stock markets until the final result,” BVSC warned.

According to MB Securities Co (MBS), the Vietnamese market seemed to suffer less from the world tension than other regional and overseas markets.

Việt Nam has signed and will sign a lot of trade agreements, which is expected to lure more foreign capital in the economy, and Vietnamese businesses will have opportunities to expand their markets and production.

In addition, the economy’s gross domestic product (GDP) in the first quarter of 2018 made the strongest 10-year growth rate of 7.38 per cent, recording growth of all three economic sectors especially industrial and building sectors. Stable low lending rates have also supported local businesses and encouraged cash holders to make investment in the securities products.

Moreover, investors are paying attention to corporate earnings, which is the factor to drive the market sentiment at the moment in the context of firms holding their annual shareholders’ meeting.

Large-cap shares will take turn to lead the stock market up this week, BVSC said, adding that cash inflows are forecast to spread among firms and “mostly run into stocks supported by positive information of first-quarter earnings results and their annual general shareholder meeting (AGM) season.”

Viet Dragon Securities (VDSC) said in a note that mid- and small-cap stocks have become more attractive with their potential earnings results, the power sector being a typical example.

Cash would be withdrawn from large-cap stocks in coming days after they have raised a lot, VDSC said. However, “considering the positive macroeconomic growth and strong inflows in the stock market, opportunities in the long term are high,” it said. – VNS