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Upbeat investor sentiment lifts stock market up high

In Uncategorized on December 16, 2010 at 10:06 am

The stock market is roaring back on increasing confidence, helping many investors to achieve big profits.

Two investors caustiously watch share prices updated at a HCMC-based brokerage (Photo:Minh Tri)

VN-Index, the gauge of 271 companies and five mutual funds listed on the Ho Chi Minh Stock Exchange, regained more than 10 percent in the last one month, while the index of the Hanoi’s bourse rose 20 percent.

Brokers said the profit rate of the stock market’s investments was around 6-12 times higher than banks’ interest rate.

Nguyen Thanh Long, an investor favoring mineral shares, achieved a profit rate of 30 percent from investing in Nari Hamico Minerals Joint Stock Company (KSS) last month.

“I bought KSS at VND24,000 per share last month as I found it reasonable. Later I bought more as the share kept falling to around VND20,000, making an average price of VND21,000. I eventually took big profits when KSS rose to VND28,000 early this month,” Long recalled.

Tran Van Thanh, who has entered the market since it was set up, said he gained nearly VND30 million from investing in the air conditioner maker REE (REE).

“I bailed out of the market at the end of July and came back at the time when the VN-Index bounded back from 420-430. I just bought 10,000 REE shares at the price of VND14,000 at that time as I didn’t think the market would recover strongly,” Thanh said.

“I made around VND30 million from selling those shares, which jumped by 20 percent to VND17,000.”

The stock market will likely to remain on a rise until the end of the year, said Hoang Thach Lan, heads of the brokerage unit at the Ho Chi Minh City-based MHB Securities Co., the investment arm of Mekong Housing Bank.

“However, investors should be cautious. One of the biggest mistakes investors often make is to make out a certain reason that they believe it has boosted the market,” Lan said.

“For example, some individual investors told me that they would return to the stock market with long-term investments on an expectation that foreigners would pump money strongly into the market in early 2011.

“But there’s little likelihood that investors would pump as much money into the stock market as they did in the 2006-2007 period.”

Surging trading value
Statistics showed trading value on the Ho Chi Minh Stock Exchange increased sharply by VND17.5 trillion (US$875 million) in the last ten trading day.

According to the State Securities Commission, foreign investors pumped $920 million into Vietnam’s stock market in the first 11 months of the year.

The market’s sentiment was boosted by foreigners’ moves, said Nguyen Viet Hung, head of the analysis and investment unit of the brokerage SME.

“Many investors bailed out from the bearish market, which lasted from the middle of the second quarter to the third quarter this year. Therefore, I expect the current bullish run, which has just been started, will be extended further if those investors returned to the market,” Hung said

Source: SGGP

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