Market eases off five-day rallies

Phuong Thao

The VN-Index came under pressure in early trade because of the unexpected 2% fuel retail price hike on Wednesday night but managed to claw up to 500 points in the morning session. However, resistance was strong at that level and selling pressure pushed it back down.

Viet Capital Securities Company said trading volume on the Hochiminh Stock Exchange improved 26% to 53 million shares worth VND1.3 trillion as foreign investors acquired a significant number of shares. Foreign investors’ buying totaled VND248 billion, accounting for 19% of the turnover on the bourse.

However, selling outpaced buying, leaving foreign outflows at VND18 billion. Like the previous session, DPM was most sold by foreigners, it said.

The Hanoi market also slipped on Thursday with turnover down to nearly VND147 billion. The HNX-Index lost 0.44% and ended the day at 62.97.

HCMC Securities Company said the market saw contrasting fortunes for some index heavyweights with gains in MSN, DRC and CSM, current market favorites on regular speculation about institutional buying patterns, and HPG.

“Then in contrast, we saw some profit taking in HAG after recent strong gains while VNM closed flat after failing to hold onto early gains. Sentiment has an upward bias although there is still a fair amount of resistance at current levels. The market is torn between concern over some residual foreign selling in recent days and optimism of possible movement on the foreign ownership limit (FOL) theme,” it said.

Viet Dragon Securities Company (VDSC) said investors were cautious when the VN-Index reached the 500-point level with selling outpacing buying within this sensitive zone.

“Having updated data of exchange traded funds (ETFs), we see that foreign net selling pressure in on Thursday’s session came from Van Eck ETF. Foreign participation improved today but high selling pressure on some blue-chips remained,” it commented.

Recent developments suggest that the market is still in sideways moving and consolidation. Rubber and tire stocks with bright business prospects stay on the spotlight and they are favorites of investors at present. However, the sectors that can support the market uptick such as finance and real estate are still falling.

From the viewpoint of investors, VDSC said the VN-Index might find it hard to return to the highs reached in early June. If flat movements last too long, they will turn pessimistic and the market will drop back.

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