Investors at Bao Viet Securities Co trading floor in Ha Noi. Shares continued to advance yesterday afternoon for the third day in a row. — VNS Photo Thai Ha

HA NOI (Biz Hub)— Shares continued to advance yesterday afternoon for the third day in a row, sending the benchmark VN-Index to a three-year high of 527.97 points and demonstrating the solidity of investor confidence in the current rally.

On the HCM City Stock Exchange, total market volume was little changed from the previous session, totalling more than 74.5 million shares, worth VND1.275 trillion (US$60.7 million).

Blue chips again led the HCM City market rise with the VN30 (tracking the top 30 shares by market capitalisation and liquidity on the southern bourse) up 0.91 per cent at 588.21 points.

Bank shares were among the biggest gainers. Vietinbank (CTG), the most second active code on trades of over 4.2 million shares, jumped 6.1 per cent to VND20,900 (US$1) a share.

This was its second rising session after it announced a plan to raise foreign holdings from 12.79 per cent to 30 per cent from Tuesday.

Shares of other banks including Eximbank (EIB), Sacombank (ST), Military Bank (MBB) and Vietcombank (VCB) also gained 0.6-3.3 per cent.

On the Ha Noi Stock Exchange, the HNX-Index also added 0.38 per cent to hit 65.58 points on total trading value of nearly VND461 billion ($22 million).

Bank shares also dominated the northern market. Sai Gon-Ha Noi Bank (SHB) was the most active code on trades of nearly 8.8 million shares at the value of VND7,300 a share.

The market is now overexcited about the information that the State Securities Commission will soon propose raising the foreign holdings limit in listed companies.

This would allow foreign investors to increase their holdings from 49 per cent to 59 per cent in listed firms through issuing non-voting shares (except in the banking sector), according to stock analysts of HCM City Securities Co.

"However, we maintain a cautious view on this issue, as holding non-voting shares is less attractive to foreign investors. In other countries, stocks without the voting right are cheaper than common stocks," they wrote in a note.

Domestic companies in which foreign investors wanted to increase their holdings such as Vinamilk, FPT Corp, Asia Commercial Bank and Military Bank were not interested in issuing non-voting shares, they added, predicting that "investors' excitement would soon cool down."

In contrast with active trading by local buyers, foreign investors continued to be net sellers on both exchanges yesterday, unloading shares worth a combined VND64.4 billion ($3.1 million). — VNS