Stock Market Likely To Improve This Week, Say Brokers

Viet Capital Securities Co. said the short-term technical view has further improved after the VN-Index closed 0.3% higher at 351.55 points last Friday. Investors could feel a bit relieved in putting 2011 behind them and might be bullish enough to boost their accumulation of stocks before taking off for the New Year holiday. Therefore, an upgrade to short-term ‘up’ is likely in the first trading week of the New Year.

“As we mentioned earlier, we see two possible scenarios that will lead to a medium-term ‘buy’ signal. We wait for a final drop to 330 points, either stretching the already oversold technical line to another extreme point or following a premature short-term ‘buy’ signal, the broker said.

“We added FPT to our medium-term ‘buy’ recommendation list as its medium-term technical figures have turned positive. The stock should also have limited downside in case the VN-Index is not able to complete a medium-term bottom. We understand that FPT will likely underperform should the general market finally turn up. However, thanks to its defensive character, we feel comfortable to recommend the stock now, even though the indices were not yet been upgraded to medium-term ‘up’.”

The stock broker also held an upbeat view on other high beta plays like MSN and BVH, but advised investors to wait for more support by the broad market before recommending these kinds of stocks. “In any case, we are watching the market closely as we think that the 330-point mark in the VN-Index will be the low of 2012,” it said.

APEC Securities Co. said the market would move sideways or retreat again within the next few days but those rising sessions, if any, are not signs of the market’s bottoming out. As supporting lines nearest to the VN-Index seem to have no meanings, medium and short-term investors should not join the market now.

Long-term players can consider buying stocks at a moderate ratio. The selection of stocks should be based on fundamental factors, APEC added.

The Hanoi market gained a slight 0.74 point, or 1.28%, against the previous week to 58.74 with three rising and two falling sessions. The market’s daily trading volume averaged out at nearly 32.3 million shares worth VND269.6 billion, up 13.9% and 11.8% against the week earlier respectively. The market is predicted to recover slightly this week.