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| Investors follow stock prices at Rong Viet Securities Co. in HCMC. Stock brokerages expect the market rally to extend this week after strong rises last week - Photo: Le Toan |
APEC Securities Co. in its weekly comment said investors might be more excited after the National Day holiday with three rising sessions last week and the VN-Index gaining 29.61 points, or 6.9%, from the previous session to close at 458.75. Liquidity strongly improved with the average daily trading volume of 45.7 million shares worth VND1.2 trillion, increasing by 15.8% and 20% against the week earlier respectively.
“The VN-Index will have the supporting level of 430 points and resistance level of 475 points this week. We continue to advise investors to boost investment in steel, sugarcane, food and property stocks with good basic factors this week, especially in correction phases,” APEC said.
Vietnam International Securities Co. (VIS), meanwhile, noted active participation of foreigners during the week. They were net buyers to the tune of around four million shares worth VND222 billion.
Foreigners played an important role in the VN-Index rally last week as they boosted buying many large caps, making local investors feel more confident and demand outpace supply on the market. As a result, the gainers far outpaced the losers at 234 to 16 at the end of the week, the broker commented.
“As we have mentioned in earlier reports, the market needs a new cash flow to sustain a strong rally. Though exact information of a new strong cash flow from foreigners is not clear during the past time, we think that foreigners have brought about a cash flow into the local market, but it is not strong enough to maintain a long-term uptrend,” VIS said.
However, VIS believed that the cash flow would keep investors optimistic and improve liquidity on the market. “With the cash flow, the market may continue recovering its lost ground, while investors may use more financial leverage products and trading volume will be higher this week,” VIS added.
HCMC Securities Co. (HSC) after the last session of the week said the technical driven rally could only go so far and many stocks have already recovered 15% or more from the bottom. “Therefore, we can say that valuations have now gone from cheap to reasonable again and to drive us higher requires a change in the external environment,” it said.
“We are of course still waiting for positive developments concerning adjustments to Decree 13. And now that we have recovered over 40 points on the VN-Index, investors will start looking for some fundamental reasons to drive stock prices higher next week, either better macro news flow or a material change in supply-demand situation. The macro environment is unlikely to be the source of positive news, therefore our best hope lies with an improvement in the supply-demand on the market,” HSC said.
The Hanoi market also enjoyed strong rallies with the HNX-Index adding 13.38 points, or 11.31%, from the previous week to close at 131.66. The daily trading volume averaged at 37 million shares worth VND835 billion. The market is expected to continue improving this week.
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