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Market correction likely this week, brokerages say

Phuong Thao
Monday,  Sep 11,2017,20:10 (GMT+7)
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Market correction likely this week, brokerages say

Phuong Thao

HCMC – Securities enterprises predict the market will enter a correction phase this week as the VN-Index beat the 800-point level last week.

Bao Viet Securities Company in a latest report said profit taking would accelerate early this week, concentrating on medium and small stocks. The VN-Index may start a correction phase after beating the 10-year high of 800 points last Friday.

BIDV Securities Company noticed that market turnover declined strongly last Friday although the VN-Index increased. Cash flow focused on a number of large caps while most other stocks encountered selling pressure.
As the VN-Index is likely to correct this week, investors should be cautious, but can take this opportunity to buy stocks with growth potential and hovering at reasonable price levels currently, it said.

Viet Capital Securities Company said last Friday’s low turnover indicated that buyers were cautious while sellers turned impatient. Therefore, though the VN-Index and VN30 Index reached new highs, they may not maintain their upside this week but will likely lose steam due to investor caution.

The VN-Index closed last week up 1.58% at 801.2 points while the HNX-Index gained 0.11% at 103.92 points. Turnover tumbled on both exchanges, with matching volume averaging out at 140.7 million shares each session on the HCMC market and 37 million shares on the Hanoi bourse, down 31% and 29% from a week earlier respectively.

Large caps continued driving stock indexes up, in which beverage giant SAB was the top booster. The stock jumped around 10.7% during the week, probably due to the announcement of VND2.4 trillion in reviewed after-tax profit in the last six months of 2017, up nearly VND150 billion against what was written in the unaudited report.

Meanwhile, most other stocks declined on sluggish trade. Small and speculative stocks also performed poorly due to the shortage of cash flow.

Bank stocks were no longer market drivers, seesawing in a narrow range or declining during the week with low trading volume. In addition, foreigners net sold over VND74 billion of shares on both exchanges, including VND74 billion on the HCMC market and VND280 million on the Hanoi bourse.

Among the decliners, trading firm HTT lost a hefty 20% as investors took profits after a week-long rising streak. PPI, an infrastructure developer, fell 7% for its loss in the first half of 2017.

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