A rebound in the shares of securities companies and increase interest by foreign investors helped lift shares on the Ha Noi Stock Exchange last week, while the heavy influence of a handful of plunging blue chip shares proved to be a drag on the market in HCM City.

In Ha Noi, the HNX-Index gained a cumulative 0.38 per cent over the course of the week to close on Friday at 95.21 points. Meanwhile, on the HCM City Stock Exchange, the VN-Index plunged by 6.86 per cent to conclude the week at 461.08.

Helping the HNX-Index rally, shares of securities companies – heavily represented on the Ha Noi bourse – rebounded significantly following the previous week’s chaos in the sector surrounding Kim Long Securities Co’s announcement that it was exiting the brokerage business.

“Many stocks on the northern market remain very attractive, under VND20,000 per share, after a long period of decline,” said FPT Securities Co analyst Nguyen Quang Vinh.

Ha Noi broker Nguyen Quang Minh also noticed a movement of foreign investors from HCM City to Ha Noi. Last week, foreign investors were net sellers on the HCM City market of VND254 billion (US$11.8 million) worth of shares, with their net sales climbing to VND215 billion (10.2 million) on Friday alone. Meanwhile, foreign investors were net buyers in Ha Noi of shares worth VND125 billion ($5.8 million).

“The VN-Index declined as foreign investors sold out a number of blue chips that had previously posted gains,” Minh said.

HCM City Securities Co analysts said that the VN-Index was more heavily influenced by the movements of a few large-cap shares, such as those of insurer Bao Viet Holdings (BVH) or conglomerate Masan Group (MSN).

While Vinh agreed that these stocks had weighed on the VN-Index, he felt the underlying cause was from concerns over the Japanese nuclear crisis.

“It’s the third largest economy in the world, and the damage from the earthquake, tsunami and nuclear disaster in Japan fuelled broad concerns worldwide, including in Viet Nam,” Vinh said, although he predicted that the impacts on the Vietnamese market would be limited and short-term.

Heavy sales by foreigners would be well worth market attention as they might reflect their worries over domestic economic uncertainties, said Tai Viet Securities Co analyst Ho Ba Tinh.

March inflation data would be released in the coming week, and if inflation again exceeded a one-month rate of 2 per cent, market sentiment might further deteriorate, Tinh said.

Over the past weekend, the HCM City Statistics Office released March inflation data for HCM City which showed prices rising 2.2 per cent over February’s. In Ha Noi, March inflation was estimated at an even headier 2.4 per cent.

“It is still too early to confirm a sustainable recovery of the market, since economic information has not improved and Government policy remains focused on fighting inflation,” Tinh said.

Source: VNS