Stock markets forecast to remain positive

Investors at the trading floor of the Bao Viet Securities Company (Photo: VNA)

The benchmark VN-Index on the Ho Chi Minh Stock Exchange rose 0.14 percent to close February 22 at 988.91 points, marking a five-day gain of nearly 4 percent.

The minor HNX Index on the Hanoi Stock Exchange finished last week up 0.66 percent to close at 106.82 points, marking a weekly gain of 0.6 percent.

An average of 228.7 million shares was traded in each session last week, worth 4.9 trillion VND (210 million USD).

According to Bao Viet Securities Company, the market would be strongly affected by large-cap stocks and see a wide pergence among stock groups.

Capital flows were also forecast to run into stocks that had not made significant gains or were accumulating profits such as oil and gas, bank, building material and real estate stocks.

“Although the short-term trend remains positive, investors should avoid new buying positions at above 991 points due to the rising possibility of a market correction at that resistance zone,” BVSC said in its report.

Banks, property developers, consumer staple firms and petroleum companies were the driving forces behind stock market last week thanks to business results, BVSC said. Since the Tet (Lunar New Year) holiday, foreign investors had bought a net value of 2.7 trillion VND on HoSE, helping the market gain momentum.

A large part of the foreign cash inflow came from notable exchange-traded funds (ETFs) such as VanEck Vectors Vietnam ETF (VNM ETF), and db-trackers Vietnam ETF (FTSE Vietnam ETF) and VFMVN30 ETF.

According to data, since the Lunar New Year, FTSE Vietnam ETF has issued a total of 520,000 fund certificates, equivalent to 390 billion VND. As Vietnamese stocks accounted for 100 percent of the FTSE Vietnam ETF portfolio, all of the money above was disbursed by FTSE Vietnam ETF into Vietnamese stocks.

VNM ETF has also issued more than 1 million fund certificates, equivalent to 400 billion VND since the Lunar New Year. From the beginning of 2019, VNM ETF has issued more than 2 million fund certificates, equivalent to 760 billion VND.

Unlike FTSE Vietnam ETF, the number of Vietnamese stocks in VNM ETF’s portfolio accounted for only about 75 percent. However, the number of fund certificates issued in the early days of the year, worth millions of dollars, also brought positive signs to the Vietnamese stock market.

Meanwhile, the VFMVN30 ETF has issued 16.3 million fund certificates, equivalent to 246 billion VND since the Lunar New Year. Since the beginning of 2019, VFMVN30 ETF has issued 23.8 million fund certificates, equivalent to 353 billion VND.

It was estimated that since the Lunar New Year, the amount of foreign money flowing into the Vietnamese stock market via the three funds were equivalent to 37 percent of total foreign net buying on HoSE.