Securities firms have predicted the market would oscillate in a narrow range this week.
Last Friday, the VN-Index briefly broke through the 580-point resistance level but fell below it at the close due to heavyweights’ retreat. HAG and MSN closed at intraday lows, taking away the most points from the VN-Index.
On the other hand, bank tickers STB and EIB led the gainers and contributed a combined 0.8 point to the VN-Index of the HCMC Stock Exchange. There was another sizable put-through transaction of KBC with 5.1 million shares, following the 5.8 million shares in the previous session. Foreigners remained net sellers at VND67 billion.
The FTSE Vietnam Index, the underlying index for the exchange traded fund (ETF) DB FTSE Vietnam, announced its quarterly review results. SBT will be excluded from the index while there will be no inclusion.
According to Viet Dragon Securities Company, investors received some important information last week such as the decline of February’s Purchasing Managers’ Index (PMI) to 51 points, no adjustment of fuel retail prices though the base price was higher than the retail level by VND110-250 per liter and Japan’s more official development assistance (ODA) capital for Vietnam.
Most newsworthy was a new housing law tailored to loosen some conditions for home ownership by foreigners and foreign institutions in Vietnam.
“We expect this policy along with other bailout packages and adjustments of Circular 16 could help revive the property market in the near future. Investors’ reaction to the news was quite positive with the VN-Index correcting in the two consecutive days but recovering in the three final sessions of the week,” VDSC said.
Closing the week, both indices decreased by the same amount of 1.1% at 579.75 for the VN-Index and 82.16 for the HNX-Index. Average trading volume on both exchanges was 205 million shares per day, down by 13% compared to the previous week. Foreigners strongly net sold VND476 billion worth of shares on both exchanges.
Concerning FTSE ETF’s rebalancing result, VDSC said it would not cause strong impacts on the market as SBT made up less than 1% in the fund’s portfolio.
For the VNM ETF, the proportion of Vietnamese stocks is 70% higher than the allowable level. The VNM ETF will announce its new portfolio this Friday but it is likely to sell out shares to lower the ratio to the permitted level.
“Thus, we think foreign capital outflows will continue to weigh on the market in the next two weeks. In general, we think the market will hover around the recent resistance levels which are 580 points for the VN-Index and 80-82 points for the HNX-Index if there is no further positive information,” VDSC said.