Shares rebound on rates cut

Update: March, 18/2014 - 08:54
Investors watch market fluctuations at ACB stock trading floor in Ha Noi. Shares posted strong gains yesterday following key interest rate cuts. — VNS Photo Viet Thanh

HA NOI  (VNS) — Shares strongly rebounded on both the national stock exchanges following yesterday's announcement by the central bank that it has cut key interest rates.

Many experts claimed that greater capital inflow will shift to the stock market as the Vietnamese dong deposit interest rate caps have been lowered to 6 per cent per year from the current 7 per cent.

More than 380 codes on both the bourses gained yesterday, boosting benchmark indices.

On the HCM City Exchange, the VN-Index increased for the ninth consecutive day, adding 3.53 points or as much as 0.59 per cent to close at 600.36 points.

Although the profit-taking pressure was always technically great at the 600-point resistance level, the significant cash flow coupled with investor confidence, which was boosted by the rates cut news, allayed the pressure.

Liquidity boomed as the total trading value reached more than VND3.3 trillion (US$157.14 million), 30 per cent higher than last week's average trading value and more than 170 million shares were traded.

Blue chips showed mixed movement with 12 gainers and 15 losers. However, the VN30-Index, which tracks the southern city's 30 largest shares by capitalisation and liquidity, added 0.56 per cent to finish yesterday at 672.15 points.

The market gain yesterday came mainly from blue chips, such as Masan Group (MSN) and PetroVietnam Transportation Corporation (PVT), which hit their ceiling prices yesterday, on the news that the Market Vector Viet Nam ETF will increase its investment in the two stocks during this review period.

MSN rose 6.9 per cent yesterday to close at VND108,000 ($5.14) per share, while PVT closed at VND16,000 ($0.76) per share with a gain of 6.7 per cent.

The other gainers were real estate giant Vingroup (VIC), Hoang Anh Gia Lai (HAG), Sai Gon Securities Company (SSI), and Vinh Son Song Hinh Thermoelectric Company (VSH).

However, Bao Viet Group (BVH), Vinamilk (VNM), PetroVietnam Drilling Corporation (PVD), and Hoa Phat Group (HPG) were among the losers yesterday. The Sacombank (STB) and Vietcombank (VCB) were the two other losers.

Overall, 178 codes gained on the southern bourse yesterday, overwhelming losers that numbered at 71.

The interest rate cuts also boosted liquidity on the northern bourse to a new record with the trading value topping at VND1.37 trillion ($65.2 million) on the exchange of nearly 124.6 million shares.

The HNX-Index jumped 2.22 per cent to finish at 86.31 points, while the HNXFF-Index, comprising stocks with a minimum free float rate of 5 per cent, ended at 86.53 points, rising 2.35 per cent.

Comprising top stocks, the HNX30-Index posted a gain of 3.01 per cent yesterday to end at 175.1 points.

More than 200 codes closed higher yesterday on the northern bourse, while only 48 codes showed downward movement. — VNS