Market expected to go up this week, say brokers
By Phuong Thao - The Saigon Times Daily
HCMC – Securities enterprises expected the local stock market to improve further this week as it ended its losing days with a strong rebound and better liquidity last Friday.
Viet Capital Securities Co. (VCSC) said the market halted a five day losing streak with a deputy prime minister making an announcement to pump VND21 trillion per month into the economy from now until the end of the year.
Investors cheered the news as they expected this could help bolster the economy, which was expected to grow at only 4.31% in the first half of the year. The announcement triggered strong demand for stocks. Liquidity also improved significantly as the session also marked the last day for the FTSE Vietnam Index ETF to rebalance its portfolio.
Last Friday’s gains offset all losses on both exchanges during the week. The VN-Index finished last week up a slight 0.19 point, or 0.045, against the previous week to close at 433.09.
HCMC Securities Co. also said that last Friday’s movement looked far more significant than the other mini rallies seen in recent weeks.
“We have said all week that margin positions were increasing while the net money outflow we have seen since April has been decelerating markedly in recent days, suggesting the market was gathering some momentum once more. Even so we have turned progressively more bullish for some days already and see on Monday as a sign the market wants to push higher once again,” it said.
HSC also predicted that the market would likely react positively to the Government’s new stimulus plan for a couple of days although as ever investors would require more details about it. However, with market volumes having improved recently as margins increase and retail customers return, the chances of a sustained movement to the upside are increasing.
VCSC said it expected an upside of 15% for the VN-Index and 20% for the HNX-Index over the next couple of months.
“Having said that, we would cut losses short should the stop loss levels on our individual positions or the 405-point level in the VN-Index or the 71.8-point line in the HNX-Index fail to hold,” VCSC added.
The Hanoi market retreated 0.24 point, or 0.32%, against the previous week to 74.84 with three rising and two falling sessions. The market’s daily trading volume averaged out at nearly 46.2 million shares worth VND483.5 billion, down 12.3% and 5.9% against the week earlier respectively.