Investor psychology improved over the course of last week, helping lift trading values and volumes on both of the nation's stock exchanges. On the HCM City Stock Exchange, the VN-Index gained 1.8 per cent last week, concluding Friday's session at 424.47 points.

The volume of trades rose 70 per cent over the previous week's level, averaging 59.4 million shares and a value of VND888.5 billion (US$42.3 million) per session.

Blue chips were among the week's biggest gainers, with the VN30 Index also rising by over 1 per cent to 497.43 points.

On the Ha Noi Stock Exchange, the HNX-Index shot up over the course of the week by over 3 per cent, closing on Friday at 72.54 points. The average daily volume of trades also rose by 55 per cent, reaching nearly 47 million shares, for an average daily value of VND435 billion ($20.7 million).

Foreign investors increased their buys on both stock exchanges last week, up shares worth a combined net of nearly VND101.8 billion ($4.8 million).

Market movements over the course of five trading sessions were mixed, with up and down sessions alternating. However, investor sentiment was more positive overall and declining sessions were attributed to profit-taking pressures, wrote analysts for the financial website vietstock.vn.

"Some stocks have reached attractive profitability levels," they said. "Meanwhile, some investors opted to sell to reduce risk since stock indices were advancing close to their resistance marks."

No economic information had significant impact on the stock market last week, they noted, although the State Bank of Viet Nam Governor Nguyen Van Binh told a conference between banks and enterprises in Ha Noi last week that lending interest rates would be kept stable at 15 per cent for at least one year to help companies fulfill their business plans.

Minister of Finance Vuong Dinh Hue also predicted to reporters that Viet Nam's stock market would perk up by the end of the third quarter as the economic situation improved. Inflation had already cooled to such an extent that June CPI figures actually reflected a brief deflationary period, with consumer prices falling 0.29 per cent in Ha Noi during the month and 0.57 per cent in HCM City.

In the recent strategic report from HCM City Securities Co, the company's analysts predicted a bull market had begun and recommended that its investors participate. They noted such positive signs as improved trading volumes and ongoing net buys by foreign investors. Technical indicators also suggested that the market had hit bottom and investors had begun returning to the market.

They warned, however, that current economic condition has not signifcantly improved and the short-term market spike was based on technical factors and would need further support from more consolidated economic data to be released later this month.

Second-quarter earnings results continued to be mixed. Some blue chips posting high profits included PetroVietnam Gas (GAS), dairy giant Vinamilk (VNM) and Phu My Fertilisers (DPM), which all had net profis between VND972 billion ($46.3 million) and VND2.26 trillion ($107.6 million). However, many companies in securities, construction and logistics sectors reported losses.

By July 20, only 230 of 702 listed companies had reported their second-quarter results.

VNS