Bargain hunting boosts local stocks
Bargain hunting boosts local stocks
Shares rebounded yesterday as bargain hunting increased on investor expectation that the market will get back on the track soon.
The VN-Index recouped 0.58 per cent to close the afternoon trade at 714.93 points on the HCM Stock Exchange.
The key market index has lost more than 2.8 per cent in the last four sessions. Its growth has also slowed from nearly 10 per cent in mid last week to roughly seven per cent on Monday.
On the Ha Noi Stock Exchange, the HNX-Index edged up 0.94 per cent to end at 89.12 points. The northern market index decreased 1.9 per cent in the two previous sessions.
“The strong recovery of the VN-Index in the last trading minutes surprised the market today,” said Tran Hai Yen, a stock analyst at Bao Viet Securities Company, in Tuesday’s market report.
Demand rose in the second half of afternoon trading, lifting many large-cap stocks including Vinamilk (VNM), insurer Bao Viet Holdings (BVH), Vietinbank (CTG), Vietcombank (VCB), private equity firm Masan Group (MSN), IT giant FPT Group (FPT) and PV Gas (GAS).
“Today’s strong growth is a good signal for tomorrow’s trading. We expect another rally but not significant given short-term risks from global turbulence,” analysts at Vietnam Investment Securities Company wrote in a report.
Money flow is strong and awaiting a suitable time to return to the market with other investment channels less attractive, the report said, indicating a rise in liquidity on Tuesday.
A total of 258.3 million shares worth a combined VND5.2 trillion (US$228 million) were traded in the two markets, up nine per cent in volume and six per cent in value compared to Monday’s figures.
“However, it is too early to assume a sustainable bullish trend when objective information concerning geopolitical issues, especially the North Korea issue, still contain numerous potential risks,” Yen said.
She advised investors to avoid aggressive buying and reducing stock exposure of overall portfolios.
Fertiliser companies filed an application to the Ministry of Industry and Trade (MoIT) for a safeguard tariff on a number of imported fertiliser products but this information did little for fertiliser firms.
PetroVietnam Fertiliser & Chemicals (DPM) and PetroViet Nam Ca Mau Fertiliser (DCM) rallied but Binh Dien Fertiliser (BFC) and Lam Thao Fertilisers and Chemicals (LAS) declined.
There has been no final decision from the MoIT. However, if this request is approved, the performance of local fertiliser companies is expected to improve, as steel stocks did last year.
