Banks lead market upturn

Shares rose stronger in July 31 afternoon trading as bank stocks accelerated their growth on the back of positive first-half business earnings.
On the HCM Stock Exchange, the VN-Index surpassed the latest nine-year peak recorded on July 6, hitting 783.48 points, a rally of 0.82 percent over July 28’s close.

The benchmark index expanded 2 percent last week.

On the Hanoi Stock Exchange, the HNX-Index increased 0.63 percent to end at 101.18. The northern market index gained 2.6 percent in the previous week.

“The risk of a short-term sharp decline was significantly diminished. Large-cap stocks, especially bank stocks, are supporting the indices’ uptrend,” said Tran Hai Yen, a stock analyst at Bao Viet Securities Co (BVSC).

Banks were the biggest gainers yesterday, with an average growth of 2.33 percent, data onvietstock.vnshowed.

Seven of nine listed banks gained value, with two of the three largest banks by market value, BIDV (BID) and Vietinbank (CTG), increasing 5.7 percent and 4.6 percent, respectively.

The largest lender, Vietcombank (VCB), edged up 0.7 percent.

According to BVSC’s report, Vietcombank is the most profitable bank with pre-provision operating profit of 5.05 trillion VND (224.7 million USD) by the end of June, up 20.5 percent year-on-year and fulfilling 54 percent of its yearly target.

BIDV also recorded positive earnings with pre-tax profit for the first six months reaching 4.05 trillion VND, a year-on-year increase of 24.7 percent and completing 54 percent of the goal it set for the year.

Military Bank (MBB) posted over 2.5 trillion VND worth of pre-tax profit in the first half of this year, rising 36 percent over the same period last year and achieving 55 percent of its yearly target. MBB’s shares advanced 1.3 percent on July 31.

“Solid earnings results as well as benefits of the bad debt resolution law and quantitative easing policy are drawing cash flows into bank stocks," Ms. Yen said.

Other blue chips were mixed. Insurer Bao Viet Holdings (BVH), PV Gas (GAS), VinGroup (VIC), Sabeco (SAB), Novaland Investment (NVL) and FLC Faros Construction (ROS) advanced. However, dairy giant Vinamilk (VNM), FPT Corp (FPT), Mobile World Group (MWG) and Kido Group (KDC) tumbled.

Liquidity increased with a total 345 million shares worth 5.4 trillion VND (237.5 million USD) being traded in the two markets, up 34.3 percent in volume and 25.6 percent in value compared with last week’s daily average volume and value.
Source: VNA