Markets sputter on global fears

[kieudiemvje]

A sharp decline on the HCM City Stock Exchange last Friday capped a gloomy week in which the VN-Index lost a total of 1.19 per cent of its value to close at 505.12 points.
With an average of 53.2 million shares changing hands per session, trading volume rose nearly 16.9 per cent over the previous week, however, with trades averaging a total value of VND1.6 trillion (US$86.5 million) per day.
Penny stocks were the week's strongest performers, with South Viet Nam Container Shipping (VSG), Do Thanh Technology Corporation (DTT), and Viettronic Tan Binh Company (VTB) among those that reached their ceiling prices.
On the Ha Noi Stock Exchange last week, the HNX-Index closed on the week down by an even more dramatic 1.8 per cent to 160.4 points. The average daily trading value rose by 5.6 per cent over the previous week to VND1.3 trillion ($70 million) on an average volume of 42.65 million shares.
Market analysts at Woori CBV Securities Company said that domestic investors were highly tuned to rumours such as that last Friday that Dragon Capital's VEIL Fund would withdraw from Viet Nam, causing a sharp decline in shares that wiped out all gains in the three previous sessions.
Investors also remained concerned over the uncertainties on global markets, particularly fears surrounding the EU debt crisis and China's foreign exchange issues.
FPT Securities Comapny analyst Tran Quang Vinh predicted that the VN-Index was unlikely to move dramatically due to investor confusion over conflicting internal and international information.
"More economic figures and corporate results will be released in July," Vinh said.
With blue chips luring insignificant capital, the money flowing to penny stocks would be just enough to create short rallies or sustain indices from seeing heavy losses, he said, predicting that 495 was a strong resistance point for the VN-Index at which point buyers would materialise, attracted by underpriced stocks.
Nguyen Van Khanh, a market analyst with a Ha Noi-based securities company, concurred, saying that the decline in the Dow Jones overnight last Friday would fuel hesitation in domestic trading today and signal another lacklustre week this week.
"The possibility of the lending interest rate falling in early July might also protect the VN-Index from a steep dip," he said, putting 490 points as the lowest point for any possible market correction.