Investors snatch pre-Tet bargains

[phuocpham]

Attempts by a few investors to grab stocks on the cheap before the Tet (Lunar New Year) holiday helped the VN-Index advance yesterday to within a whisker of 500 points on improved but still modest trading volume. The Index rose by a respectable 1.84 per cent to a close of 499.94, as the value of the day's trades on the HCM City Stock Exchange jumped by 21.5 per cent over Wednesday's total to VND989.28 billion (US$53.5 million), with a volume of 21.15 million shares.
Foreign investors helped boost the gains on the HCM City market by picking up a net of 1.8 million shares, worth a net of VND142.4 billion ($7.7 million). Dairy giant Vinamilk (VNM) continued to attract interest from this sector, as they bought up over 1.2 million VNM shares.
On the Ha Noi Stock Exchange yesterday, the HNX-Index also rose for a second day to 163.25 points, a gain of 1.4 per cent, but trading remained sluggish on a volume of just 10.5 million shares, worth a combined VND329.76 billion ($17.8 million).
"The State Bank's decision to adjust the forex rate yesterday to VND18,544 per US dollar helped cool down concerns over the trade deficit and pressures on foreign currency reserves, as well as cross-border transactions," said Dao Van Khanh, an analyst with a Ha Noi-based securities firm.
The move was especially reassuring to foreign investors, who had looked for a significant change in monetary policy, Khanh said.
Analysts at Dai Viet Securities Co noted, however, that foreign ownership limits in firms such as Vinamilk remained constrictive and limited the extent to which foreign investors could continue buying into the market.
But rumours, they said, continued to circulate that some overseas funds might shortly disburse capital into the Vietnamese market
Meanwhile, domestic investors continued to largely sit out trading ahead of Tet, said Khanh. "But, local investors might try to make the final session of the Year of the Ox bright, creating brighter prospects for the new Year of the Tiger after next week's holiday," he said.