The final week of 2009 on the HCM City Stock Exchange closed with VN-Index falling short of the hoped-for 500-mark.
The Index closed on Thursday at 494.77 for the year after a four-day trading week, off just 0.06 per cent from the previous Friday and up 56.8 percent from the year-end close of 315.62 points on December 31, 2008.
The average value of trades over the course of last week topped VND2 trillion (US$111.35 million), on an average volume of over 48.8 million shares.
"Last-minutes worries, fueled by the impending new income tax on securities trading in 2010, encouraged investors to realise profits through the end of this past week," said Nguyen Duy Tan, a Ha Noi broker.
Thang Long Securities Company General Director Quach Manh Hao wrote last week that the effect of the income tax on capital gains from equity investments, taking effect on January 1, could be an important factor in investor decisions, causing them to think more carefully when making an offer and buying only when market trends were clear-cut.
On the Ha Noi Stock Exchange, the HNX-Index fared better, managing a gain of 3.83 percent last week and closing out the year at 168.17 points, up nearly 60 percent from the year-end close in 2008.
Average daily trading volume on the northern bourse soared to nearly 27.6 million shares, for an average daily value of VND929 billion ($50.2 million).
Despite the divergent moves of the VN-Index and HNX-Index last week, the common trend remains upward, said FPT Securities Company analyst Tran Quang Vinh, pointing to the stronger confidence in market prospects reflected in the firm’s conversations with investors.
With the Government banning gold trading floors in March, capital was also expected to flow more generously towards the securities markets, Vinh claimed.
Commercial banks would resume lending for securities investment in 2010, added Tan, helping provide investors with more opportunities, as well as greater risk.
More skillfully this time
"I expect investors to behave more skillfully this time, after what they experienced in 2008-09, or they will bury themselves with debt," said Tan. "‘Unreal’ money is always dangerous."
A representative of Click & Phone Securities Company recommended that investors take a mid-term view rather than behave as day traders. "Buy-ins are recommended during market corrections and the buy rate is about 20 to 30 per cent," he said. "Sell-offs should take place when expected profitability is reached, but investors shouldn’t be hasty to re-participate right at that moment."
Vinh predicted a bull market in the short-term, forecasting the VN-Index would range between 480 and 535 points this week.
Prospects for the domestic stock market would be more stable, despite the State budget deficit and inflation making a comeback, said Vu Huu Dien, head of portfolio management for Dragon Capital, but he recommended investors keep an eye to global markets.
Foreign investors remained net buyers on both stock markets. They bought a net of 7.45 million shares in HCM City and a net of 860,000 in Ha Noi.
The unlisted public securities market (UPCoM) ended 2009 also in green, closing Friday session at 53.82 points with a sharp advance of 4.34 percent.
"This market ran well in the first six months since its inauguration," said Nguyen Thi Hoang Lan, General Director of the Ha Noi Stock Exchange, the organiser of UPCoM.
UPCoM now traded 30 stocks with a market capitalisation of VND3.8 trillion ($205.4 million), Lan said, noting that an average of about 400,000 shares changed hands on this market daily, generating a turnover of VND3.5 billion.
"We have proposed some measures to market regulators to boost this market in the new year, including the possible introduction of continuous order matching, as well as a shorter settlement period and the allowance of both buys and sells of a specific share during a session," Lan said.