Individual stocks soar, losers outnumber gainers

Update: October, 30/2017 - 08:37
The market trend of heavy dependence on several individual stocks generated some volatility in last week’s trades.– VNA/VNS Photo

HÀ NỘI – The market trend of heavy dependence on several individual stocks generated some volatility in last week’s trades.

The benchmark VN-Index on the HCM Stock Exchange hit a new 10-year peak at 840.37 points on Friday, a record high since February 12, 2008. However, the index’s weekly gain of 1.63 per cent was mostly driven by a ‘hot’ stock, the FLC Faros Construction Corp (ROS).

ROS share prices rose 39 per cent in just one week, from VNĐ141,300 per share to VNĐ196,000 (US$8.63) apiece. In the past one month, ROS shares have risen 85.4 per cent, lifting the market capitalisation of the company to above US$4 billion.

Many investors began to talk about the ‘ROS-Index,’ because its rise covered the fact of losing stocks outnumbering gainers over several sessions.

“It seems better to forget about the current market movements and focus on individual stocks,” said Hiếu Nguyễn, a senior analyst at Viet Dragon Securities Co.

Hiếu said many traders had experienced losses in their portfolio despite the continuous rise in the VN-Index.

Many stocks have declined compared to two months ago, including blue chips like Bình Minh Plastics (BMP), steelmaker Hoa Sen Group (HSG), HCM City Infrastructure Investment (CII), The Southern Rubber Industry (CSM) and Quảng Ngãi Sugar (QNS).

The market witnessed positive signals in the weekend session as a lot of large-cap stocks advanced along with ROS, including big banks like Vietcombank (VCB), Military Bank (MBB) and BIDV (BID), VinGroup (VIC), Vietjet Air (VJC), PV Gas (GAS) and Masan Group (MSN).

However, according to Nguyễn Ngọc Lan, head of brokerage division at Agribank Securities Co, the current rally is unstable given low market liquidity and overall sluggish market conditions.

“In my opinion, the market will likely experience a correction in the next few sessions.

“Basically, the index may continue to rise, but to perceive a clearer market trend, we must look at cash flows in the coming sessions,” Lan was quoted as saying on the website.

Meanwhile, without support from large-cap stocks, the HNX-Index on the Hà Nội Stock Exchange slumped 1.56 per cent for the week, ending Friday at 106.45 points.

Liquidity continued to drop last week with an average of 198.2 million shares worth VNĐ3.7 trillion ($162.5 million) being traded in the two markets per session, down 12.5 per cent in trading volume and 22 per cent in trading value compared to the previous week.

Making your pick

Phan Dũng Khánh, head of investment advisory at Maybank Kim Eng Securities Company, said shares of the banking, energy, technology, precious metals (Phú Nhuận Jewellery) and aviation (Vietjet, Airports Corporation of Việt Nam) sectors had room to rise further.

For investors with high risk tolerance, penny stocks would likely generate the fastest short-term profits, Khánh said, citing shares of Khánh Hòa Mineral Water Co (VKD), whose prices had increased tenfold over the last month.

Đặng Thanh Thế, head of individual clients advisory at MB Securities JSC, advised investors to choose the trend-flowing strategy, by withdrawing from stocks which have gained substantially since the beginning of the year and focusing on the stocks showing a bullish trend in recent weeks. – VNS