VCN - Recent trading sessions showed considerable pressure to sell stocks, but the power of the market remains strong. Many stocks such as VNM, FPT, HSG, HPG, etc are expected to continue to attract cash flow.
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Stocks in the category of ETFs
September is the time of ETFs implementing restructuring in the 3rd portfolio of the year. The stocks which are removed or added to the portfolio in the market will impact the market.
The FTSE ETF Fund has announced the portfolio of this period has added VNM and HSG. Notably, VNM first entered the category of ETFs after lifting the maximum ownership percentage of foreign investors (room) to 100%. This is the last condition for VNM after many years ETFs do not include it into their categories when “room” is always filled by other foreign investors.
Mr. Nguyen Huu Binh, Head of Analysis Division of Vietnam Investment Securities Company (IVS) said that, VNM ETF Fund will also put VNM into its category. VNM is currently owned by foreign investors with a proportion of 48.72% and the State Capital Investment Corporation (SCIC) owns 45.06%. It is forecast that the two ETF Funds might buy 10 million shares of VNM, which will have a positive effect on the VN-Index and VNM.
Mr. Binh said that in order to purchase VNM, ETF Funds were likely to sell some of the existing shares in the portfolio. Accordingly, this week may be "depressed" for the price of these shares, but many other shares still bring good opportunities for investment. Indeed, some shares such as HPG, DPM and PVD still attract good cash flow.
Besides, Mr. Tran Minh Hoang, Head of Macroeconomic Analysis Division, Vietcombank Securities Company (VCBS) said that VNM was likely to be added to the new portfolio of 2 ETF Funds, including VNM ETF and FTSE ETF, with the highest proportion at 8% and 15% respectively, which had a negative impact on the general index. In addition, since mid-August 2016, foreign investors have sold net shares, focusing on blue-chips to gain profits.
Currently, it is hard to say if this capital flow will be withdrawn from the market or invested in other stocks, which can become a major cause of short-term correction, the pushing VN-Index to 660 points. However, looking at the positive aspects, VCBS will still see steady operations because of an abundant liquidity of the banking system.
For the market trend in September, Mr. Hoang predicted that in the first half of September, the index may continue to be in good condition related to the restructuring of two ETFs. In the second half of September, investors will pay attention to the monetary policy meeting of the US Federal Reserve System (Fed) as well as the initial results of the 3rd quarter of 2016 of the business community.
With a positive liquidity condition of the banking system, there is a high possibility that after a period of stability, the price level will set a peak this year.
Capital will flow slowly in the portfolio of SCIC's divestment
Stocks in the portfolio of SCIC’s divestment have had a dramatic increase in prices in recent years. According to Mr. Binh, FPT, SGC, BMP, NTP, BMI, etc have increased by above 50% in the short time. On the basis of actual business performance of the enterprises, the price of many shares has exceeded the real value and beyond enterprises’ expectation. Particularly, FPT has increased only by 10-12%, which is still quite appealing and attractive to investors and expected to increase by 15% or more in the near future.
Positive performance of stocks in the portfolio of SCIC’s divestment in recent sessions is largely due to the psychological impact and the expectations of investors at a high level, but it may "fade" quickly.
In addition, each enterprise has various activities in production, leading to a different SCIC’s divestment roadmap of each business. In addition, the process of consulting, asset valuation and public bidding are monitored closely, which means it takes a long time before the divestment of a State-owned enterprise is completed.
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With the policy of preserving property of the State, seeking the best opportunity to sell at a highest price and preventing loss of the State funds, experts of VCBS predict that SCIC will not conduct divestment immediately but step by step. Also, experts of VCBS state that the positive impact from divestment of SCIC will have a positive impact in the long term. Therefore, it is difficult to create a strong push for the stock market in a short term as well as in September.
By tinnhanhchungkhoan/ Hoang Anh