VN stocks stay stable after ETF reviews

Tuesday, Mar 12, 2019 08:00

An investor follows the market trading at Bao Viet Securities Company. — VNS Photo Truong Vi

Vietnamese shares had little movement on Monday foreign exchange-traded funds (ETFs) began shaking up their investment portfolios.

The benchmark VN-Index on the Ho Chi Minh Stock Exchange (HoSE) dropped 0.07 per cent to close at 984.60 points.

The southern market gained nearly 0.59 per cent in total last week.

More than 178.6 million shares were traded on the southern bourse, worth VND3.71 trillion (US$159.5 million).

On the Ha Noi Stock Exchange, the HNX-Index inched up 0.09 per cent to close at 108.32 points. More than 45 million shares worth VND508 billion changed hands here.

The market is running out of good news, so its movement will depend on domestic purchasing power and foreign trading, Sai Gon-Ha Noi Securities JSC (SHS) said in a daily report.

Caution from both domestic and foreign investors resulted in mixed market breadth with 158 gaining stocks and 151 declining ones.

According to Bao Viet Securities Co (BVSC), the market was weighed down by the quarterly portfolio reviews of the two foreign ETFs – FTSE Vietnam ETF and VNM ETF – which end on Friday.

ETFs’ portfolio restructuring this week may trigger net selling from foreign investors on the stock market, Bao Viet Securities Co (BVSC) said.

Foreign investors on Monday recorded VND6 billion worth of asset purchases compared to net sell value of VND60.3 billion last Friday.

VNM ETF announced its quarterly review last Friday and FTSE Vietnam ETF did so on March 2.

“Large-cap stocks may continue correcting after the VN Index failed to conquer the 1,000 point level and the ETFs begins to re-shape their portfolios,” said Nguyen Hoang Viet, an analyst at Vietinbank Securities JSC.

Thus, capital will flow from large-cap stocks to mid-cap and small-cap ones, which are expected to deliver good information about their sectors, he said.

Stocks that will be traded by the two foreign ETFs this week included property developers Vingroup (VIC) and Vinhomes (VHM), dairy producer Vinamilk (VNM), real estate firm Novaland (NVL) and Vietcombank (VCB).

Among those stocks, VHM fell 1.6 per cent and VCB edged up 0.3 per cent while VIC, VNM and NVL gained between 0.2 per cent and 4.5 per cent.

Investors clearly held their cash and were unwilling to make new purchases with a lack of supportive information for both domestic and international markets, according to Thanh Cong Securities JSC (TCSC).

In addition, they want to wait to hear from listed companies at their annual shareholder meetings, so the stock market will likely see more volatility in the coming days, TCSC said.

“In the worst scenario, the VN Index will fall to 970-975 point range” and it “may continue moving sideways with alternate ups and downs in coming days.” — VNS

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