Improved liquidity helped narrow the fall of domestic stock indices yesterday.


On the HCM City Stock Exchange, trading volume
increased 29 per cent to 17.16 million shares, with a total revenue of
VND491.5 billion (US$29.78 million).


The VN-Index lost 6.48 points or just 1.97 per cent to close at 322.8.


The southern market saw 28 gainers and 127 losers by the end of yesterday.


Sacombank (STB) saw the most action of the day with
orders for 3.25 million shares, followed by Hoa Phat Group (HPG) with
1.43 million units.


Foreign investors continued to be net sellers, selling
4.37 million shares and loading up on 2.1 million units. Net sales
value reached nearly VND90.65 billion ($5.5 million).


Quach Manh Hao, deputy general director of Thang Long
Securities, said in a report that foreign investors' net sales played a
significant part in pushing the domestic stock market down over the
past few weeks.


Hao said foreigners likely withdrew capital from the
local exchange to support their parent companies which were affected by
the world financial crisis, or shifted to other investment channels
such as property.


He also noted that they may be waiting for stock prices to decline even further.


"Most foreign investment funds in Viet Nam are closing
funds, and often committed to long-term investment, so there is little
chance that these funds will draw out of the market," the report said.
"They can even efficiently support the market in the coming months."


Dragon Capital investment fund director Dominic
Scriven affirmed that for long-term [institutional] investors like
Dragon Capital and VinaCapital, temporary sales were made to reorganise
their investment portfolios, but that they weren't planning to flee the
market.


"We believe that Vietnamese stock prices are very
attractive," Hao said. "Share prices have fallen by around 40 per cent
since the beginning of last month, much sharper than on other markets."


That's steeper than an average of 34 per cent in European Union markets and 30 per cent in the Asia Pacific, according to Hao.


EuroCapital Securities Co said in a report that while
world stock markets were performing poorly, foreign investors'
accelerated sales of bonds had pulled down the domestic market. Net
bond sales have been around VND7 trillion ($424.2 million) so far this
month.


Net bond sales, however, have recently been declining.
According to the report, the figure was VND1 trillion ($60.6 million)
last Wednesday but around VND200 billion ($12.1 million) last Friday.


Local press quoted Nguyen Son, director of the State
Securities Commission's Market Management Department, as saying that
the commission would take measures to prevent the market from a
free-fall if it continued to slide.


The Ha Noi Securities Trading Centre, meanwhile, witnessed 48 gainers and 83 losers.


The HASTC-Index slid slightly 0.14 points or 01.3 per
cent to end at 105.05. Trade volume increased 28 per cent to reach 9.78
million shares, worth around VND220 billion ($13.3 million).


Asia Commercial Bank (ACB) was the most active on the
northern bourse with 1.1 million shares traded, followed by Kim Long
Securities (KLS) with 966,000 shares, PetroVietnam Insurance (PVI) with
700,000 units and Petroleum Technical Services Corp (PVS) with 606,000.