Blue chips weigh on market

HA NOI — Sharp declines by market-leading stocks on the HCM City Stock Exchange yesterday restrained the rising trend of the VN-Index, which closed off 1.35 per cent on the day to 505.42 points.

The value of the day’s trades on the HCM City Stock Exchange remained modest, at just VND1.6 trillion (US$182.4 million), with 35.6 million shares changing hands. Decliners outnumbered advancers by 147-29, while 27 codes remained unchanged.

On the Ha Noi Stock Exchange, the HNX-Index also fell 2.46 per cent yesterday to close at 171.37. Trading value stayed low at VND691.5 billion ($71.1 million) on a total volume of nearly 20.3 million shares.

Nguyen Quang Minh of Tai Viet Securities Co blamed the market correction on rising worries about inflation and rumours of a possible increase in the prime interest rate, as well as the publication of foreign assessments of the country’s economic situation this year. An HSBC report was suggesting that Government stimulus policies in 2009 might cause a return of inflation this year.

"Investors have begun holding back on disbursements, reflected by buy orders at low prices," said Minh, also noting the low volumes during the last couple of sessions.

Fiachra Maccana, head of research at the HCM City Securities Co, said that the market could move higher in the short term despite worries that the market could stumble on the tight liquidity of the banking sector.

"Next week should give some indication about January’s consumer price index, and our house view is that the month-on-month increase will be less than December’s 1.38-per-cent level," Maccana said. — VNS