VietNamNet Bridge - Since opening again after the long Tet holiday, the stock market has bounced back, restoring investors’ confidence in the market.

The VN Index increased by 42 points after five trading sessions last week, with a sharp increase in the first four sessions and one slight decrease in the last one as an effect of the global stock index decline. The VN Index is staying above the resistance threshold of 950 points.

Reports from securities companies all say there are signs of cash flow increasing again, which, together with purchasing power, has helped improve liquidity.

The average trading volume on the HCMC bourse was 174 million stocks per trading session last week, an increase of 30 percent compared with January.

The increased liquidity and the VN Index rise are considered important signs promising the possibility of regaining market strength.

The rise of the stock index and investors’ optimism have been encouraged by the net purchase by foreign investors. In the last five trading sessions, the net purchase value reached VND1.938 trillion. 

Of this, the record high in net purchase of VND1.468 trillion was seen on February 14, while MSN alone saw the purchase value of VND1.249 trillion.

If counting the net purchase value of VND171 billion on February 1, the last trading session before Tet holiday, the total net purchase value of foreign investors reached VND2.1 trillion in the first half of February. 

The net purchase value of foreign investors in January was VND1.7 trillion.

The move by foreign investors shows that they are optimistic about the prospects of Vietnam’s stocks. This coincides with the prediction that foreign investors may return to emerging and developing markets this year.

International analysts predicted the comeback after the news that the US FED may not raise the prime interest rate amid worries about risks from the trade war. The international capital flow tends to head for markets with higher profitability.

Vietnam’s stable economic growth, its reasonable inflation and exchange rates have all attracted foreign investors, especially when the government showed its high attention to the market.

Local newspapers commented that the presence of PM Nguyen Xuan Phuc at the first trading session in the Year of the Pig had positive influences on investors, bringing optimism to the market and helping the VN Index bounce back.

Securities companies believe that the purchasing power would increase in the time to come when listed companies begin exposing their financial reports. The good business performance of many listed companies in 2018 will also help encourage investors.

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