The HCM City Stock Exchange saw an entire week of gaining sessions last week, with the VN-Index closing on Friday at 495.08, a gain of 11.67 percent over the previous week.
Average daily volume also increased by nearly 10 percent to over 40.7 million shares, worth an average of VND1.56 trillion (US$84.3 million), an increase of 18.8 percent over the previous week’s value.
Banking shares were the most active, with Eximbank (EIB) responsible for 18.9 million trades and Sacombank (STB) 17.2 million.
On the Ha Noi Stock Exchange, the HNX-Index posted a net gain of over 13 percent on the week, ending Friday’s session at 161.97 points.
The northern market also saw daily trading value up by 41 percent from the previous week’s average to VND604 billion ($32.6 million), on an average daily volume of 21.31million shares, an increase of 31 per cent over the previous week’s average.
Brokerage Kim Long Securities (KLS) was the most active share on the Ha Noi market, with nearly 17.2 million shares traded.
"Investors become excited after several consecutive sessions of gains," said FPT Securities Company analyst Nguyen Binh Duong. "Demand heated up toward the week’s end, showing a return of the speculative market and some chances to make money for investors willing to take a risk."
The gains this week may have also been a rebound from investors’ irrational overreaction the previous week to changes in economic and monetary policy, Duong said.
He noted a significant increase in new investor accounts once shares dropped below 450, a point at which stocks began to catch the eye of speculative investors, particular when the gold and foreign exchange markets had all stabilised following recent spikes and real estate remained in the doldrums.
The State Bank of Viet Nam also soothed investors by its announcement this past week that it would retain the prime interest rate at the current 8 percent, said Duong.
The Government also announced that inflation would remain below 7 percent for this year, while economic growth would reach 5.2 percent, the healthiest growth rate in the ASEAN region and one that placed Viet Nam among the 12 nations worldwide with the healthiest growth during this past year’s global economic downturn.
And with limits on credit growth in the latter part of the year blamed by many for taking the wind out of the sails of the stock market, next year’s credit growth target of 25 percent over 2009’s already high levels has been greeted enthusiastically by many investors.
Duong predicted another rising week was in store but also warned that a few profit-taking sessions were likely to impede the upward course of the market.
His fellow analysts at FPT Securities predicted a VN-Index this week in the range of 480-510, and he advised investors to focus on blue chips and leading industrial shares.
Dang Thi Minh Loan, Director of analysis for the VinaCapital fund management company, also advised investment in shares with long-term potential.
"From the beginning of next year, the market will be able to rise on a new period of credit growth as well as the expectation of strong earnings by listed companies, so, despite some corrective sessions, there will be investment opportunities," said Loan.
Foreign investors contributed to rising market trends on the week as they returned to being net buyers on both bourses. On the HCM City market, they was responsible for a net buy of 10.25 million shares, worth a combined VND414.76 billion ($22.4 million), their strongest week of buys this month.
On the Ha Noi bourse, despite being net sellers on Friday, foreign investors finished the week as net buyers overall of 531,100 shares, worth a net of VND23.54 billion ($1.3 million).