Large-cap firms to drive market up, but performance would be narrow
With about one-third of the top 30 largest companies by market capitalisation and trading liquidity having released Q3 earnings reports, there is still room for growth.
Vietnamese shares are expected to continue rising as blue chips still had room for further growth, but that growth would be marginal, securities specialists said.
The benchmark VN-Index on the Ho Chi Minh Stock Exchange advanced 0.30 per cent to close Friday at 996.57 points, totalling a weekly gain of 0.74 per cent.
On the Ha Noi Stock Exchange, the HNX-Index inched up 0.07 per cent to close at 104.71 points. The HNX-Index dropped 0.73 per cent last week.
An average of nearly 214 million shares was traded each day last week, worth VND4.28 trillion (US$184 million).
With about one-third of the top 30 largest companies by market capitalisation and trading liquidity having released Q3 earnings reports, there is still room for growth.
Most of those firms were profitable in the third quarter of the year such as brewer Sabeco (SAB), Vietcombank (VCB), VPBank (VPB), Military Bank (MBB), tech group FPT Corp (FPT) and Phu Nhuan Jewellery JSC (PNJ).
Other large-cap firms that are expected to deliver good results for the third quarter include realty firms Vingroup (VIC), Vincom Retails (VRE) and Vinhomes (VHM), Bank for Investment and Development of Vietnam (BID), Vietinbank (CTG), dairy producer Vinamilk (VNM), food company Masan (MSN) and retailer Mobile World Investment Corp (MWG).
According to Le Duc Khanh, director of strategic investment at PetroVietnam Securities Corp, banks and tech firms had outperformed other sectors in the last two quarters.
Those companies could also maintain the momentum in the final months of the year thanks to the positive outlook of the Vietnamese economy, he said.
“That’s the reason why the VN-Index can beat the 1,000 point level and rise towards 1,100 points at the end of 2019.”
With good performances in the third quarter, large-caps still had room to grow, Nguyen The Minh, director of market analysis at Yuanta Securities Co, said.
They would also benefit from the amended Law of Securities, which was expected to be approved by the National Assembly in November and would increase the foreign ownership cap in some sectors, he added.
Market conditions proved investors were quite confident and were not being overwhelmed by external factors (such as trade wars and geo-political tensions), investor and specialist Nguyen Huu Binh said.
However, investors remained cautious so capital flow would be modest, he said, adding it would be difficult to find a group of stocks to lead the market at the moment.
The market would struggle in the early trading days of the week before continuing to move up at the weekend, Bao Viet Securities Co (BVSC) said in a note.
Banks, property firms and retailers may continue their uptrends, the company said.
In a different scenario, KB Vietnam Securities Co (KBSV) forecast bank stocks had been priced in and would have troubles leading the market in the coming week.
It meant investors would sell once earnings reports were released, which would not create momentum for the stock market, it said.
The VN-Index would struggle with mixed performances between different groups of stocks, which depended on the results and prospects of quarterly corporate earnings, KBSV said. — VNS
