July 2-6: sharp ups and downs made the market unpredictable

The stock market witnessed the swift rises and falls last week: it went down dramatically in four trading sessions, and soared up in one session.

Analysts said that they have never witnessed such sharp rises and falls on the stock market. The VN Index unexpectedly decreased sharply by 31 points at the first trading session, then skyrocketed by 36 points in the next two sessions, the biggest gap ever seen in the last two months.

The VN Index dropped to below 1,000 points twice, and then bounced back, exceeding the 1,000 point threshold and closing at 1,010.53 points. With the closed level, the VN Index decreased by 14.15 points in general last week, or 1.4% over the previous week’s last trading session.
This was the sixth consecutive week the market went down.

According to a securities information service provider, the market seemed to bear the influences by the State Bank of Vietnam’s Instruction No 03 on limiting funding securities investment, and HSBC’s warning that the VN Index may fall to below 900 points by years end.

However, analysts believe that the market would bounce back soon as listing companies will announce their good business results in one or two weeks.

The HCM City Securities Trading Centre witnessed 80 share items down in price, including two fund certificates, 19 items up, and 10 others stabilized.

The total trading volume was 26.7mil units last week, or 5.35mil units a trading session. The total trading value reached VND2,651bil ($165.68mil), or VND530bil ($33.12mil) a session.
Sacombank’s shares (STB) had the biggest trading volume with 4.2mil units. Meanwhile, BBT, a penny stock, made a surprise when it had the second biggest trading volume, with 1.4mil traded units. The other three share items which saw biggest trading volume were VF1 (1.3mil units), PVD (1.1mil), and BFI certificate (over 1mil units).

HAX, the share of a transport service company, saw the biggest price decrease (- 20.6%), followed by SJ1 (- 12%), VTA (11.9%), and SDN (11.1%).

Meanwhile, TAC (Tuong An Vegetable Oil Company), saw the biggest price increase (+22.7%), followed by IMP (11.3%). Other share items just saw the slight price increases, like ITA which increased by 6.7%.

The falls in the last consecutive weeks have made investors worried that the market would fall sharply in the coming weeks. However, a securities information service provider has pointed out that both the supply and demand decreased recently, not only the demand. Investors did not sell many shares and bought in small quantities.

One of the most important reasons that led to the considerable decrease of sale orders was that 25% of listing shares saw the prices decrease by 10-20%, despite the fact that listing companies are still performing well.

However, analysts believe that once listing companies announce their business results, the share prices would recover.

TAC of the Tuong An Vegetable Oil, for example, suddenly drew the attention from investors because the company obtained high profits in the first five months of the year at VND42.25bil ($2.6mil), fulfilling 85.16% of the yearly plan. TAC prices hit the ceiling levels in the last 4-5 consecutive trading sessions, and made the new record at VND81,000/share on July 6.
This shows that investors still wait for listing companies to announce their business results.

Source: VNE