Download Weekly Report 17/10 - 21/10

17/10- 21/10/2011
Weekly Report
BIDV Securities Company
BIDV Securities Company
I
Weekly Report 17/10 - 21/10
ECONOMY
 CPI in October is expected to increase by between 0.2%
and 0.4%
 It’s expected for Fed to introduce new stimulus policies
to help U.S. stocks rally. Spain continued to be lowered
in confidence
 As of the whole week, gold prices have decreased by
2.5%, down to 1,640 USD/ounce. Oil prices remained at
87 USD/barrel
EQUITY
 The world market had a quite positive week, leading to
the hope for the possibility of terminating the downtrend
 The domestic market had a quite positive week-ending
session after two horizontally-going sessions. However,
BSC R&D DEPARTMENT
BSC Head Office
10 th Floor – BIDV Tower
35 Hang Voi – HK Dist.–Hanoi
Tel: 84 4 22206647
Fax: 84 4 22200669
Website: www.bsc.com.vn
BSC Ho Chi Minh Branch
9th Floor–146 Nguyen Cong Tru
1st Dist., Ho Chi Minh city
Tel: 84 8 3 8128885
Fax: 84 8 3 8128510
we believe that it’s not enough to be optimistic about
the possibility where the market will have a reverse
 We consider that it’s necessary for more signals to
confirm the termination of the downtrend
Asd
Đầu tư và phát triển Việt Nam
Sdsa
Asd
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Weekly Report
BIDV Securities Company
World indices
Vietnam Indices
NIKKEI 225
9000
DJI
12000
11700
11400
8500
11100
10800
8000
10500
HNX Index
78
76
74
72
70
68
66
64
62
60
9/28 10/2 10/6 10/10 10/14 10/18
VN Index
470
450
430
410
390
370
350
9/20 9/25 9/30 10/5 10/10 10/15 10/20
Source: Bloomberg
Source: Bloomberg
Crude oil, gold price
Crude oil
Interbank Interest rate
1 month
GOLD
90
1800
Overnight
14.00
12.65
12.60
12.55
12.50
12.45
12.40
12.35
12.30
12.25
12.20
13.80
1700
13.60
13.40
80
1600
13.20
13.00
70
1500
9/22
9/29
10/6
10/13
10/20
Source: Bloomberg
81
80
79
78
77
76
75
74
73
72
71
70
Dollar Index
12.80
9/20 9/25 9/30 10/5 10/10 10/15 10/20
Source: Bloomberg
USD/VND Spot rate
21000
20950
20900
20850
20800
20750
USD/VND
20700
8/1 8/11 8/21 8/31 9/10 9/20 9/30 10/10 10/20
Source: Bloomberg
9/27
10/1
10/5
10/9 10/13 10/17 10/21
Source: Bloomberg
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Weekly Report
BIDV Securities Company
ECONOMY
Viet Nam
CPI in October is expected to increase by between 0.2% and 0.4%
The Consumer Price Index (CPI) of Hanoi increased by only 0.13% over the
previous month and by 20.43% over the same period last year. The Consumer Price
Index (CPI) in October of Ho Chi Minh City rose by 0.18% over September, 0.7%
lower than the increase of the previous month and lower than the rate of 0.45% in
October/2010. This is the month with the lowest increase since September/2010.
While the group of food items in Hanoi continued with the downtrend over the
previous month, especially the group of cattle meat, fresh poultry meat with the
biggest drops, after a long period of increases in prices (decreasing by over 2% over
the previous month); the group of food restaurants and catering services in Ho Chi
Minh City also increased by only 0.06% over the previous month. However,
according to our forecasts, the CPI in October will increase by between 0.2 and
0.4% as many provinces in the Central and the North are still being affected by
natural disasters, rains and floods; this may make prices of foods and rations higher
than those in the two cities. Actually, the decrease in the price index was also
forecasted before price indexes of world foods and rations fell into the downtrend
since the last week of September. Accordingly, there are a few impacts on the
reaction of investors in the market. On the other hand, concerns about price curbing
may come from the pressure of a power price increase may as well as bring prices of
some other essential items back to the market price ground. Also therefore, the
orientation of monetary tightening continued to be maintained during the rest time
of 2011.
After the week of interest rate intense from 10/10 to 14/10, the interbank interest
rate increased by 3 - 3.5%/year, the overnight interest rate reached about 16 16.5%/ year, 1-week interest rate reached about 17 - 17.5%/year, and 1-month
interest rate reached 21%, the State Bank of Vietnam (SBV) directed about
stabilizing transactions in the interbank market, big commercial banks increased
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Weekly Report
BIDV Securities Company
their capital supply; interest rates cooled down, decreased by 2-3%/year; the
disposable funds of credit institutions ensured adequate liquidity. However, it’s
clear that, the tension and the long lasting trend in the interbank market shall be an
obstacle to the goal of reducing interest rates back to 17-19%/year for SBV. In
reality now, other lending interest rates for production - business are popular at 18%
- 21%/year, for the non-manufacturing sector are within 22% - 25% / year.
World Economy
It’s expected for Fed to introduce new stimulus policies to help U.S.
stocks rally. Spain continued to be lowered in credit rating
U.S.: It is likely that Fed officials are considering of introducing more monetary
stimulus policies. Additionally, investors also expect that the Europe will soon take
measures to curb the debt crisis. Facing the above-mentioned expectations, U.S.
stocks had a week of considerable increases in points. As of the whole week, Dow
Jones Industrial index rose by 1.4%, up to 11,808 points; S & P 500 index rose by
1.12%; and Nasdaq index decreased by 1.13%.
In September, the U.S. industrial output rose by 0.2%. The inflation increased by
0.3% after rising by 0.4% in the previous month. The core inflation (excluding
prices of food and energy) increased slightly only by 0.1%. The number of
applications for initial jobless claims last week continued to decline by 5 thousand,
down to 403 thousand. The remarkable focus next week will be information about
the U.S. GDP in the third quarter (first announced).
Europe: The credit rating organization Moody has lowered the credit rating by 2
levels against Spain for concerning about the adverse impacts of the European debt
crisis on Spain. Moody has downgraded Spain down to Aa2 from A1 under a
negative outlook. Previously, S&P and Fitch also lowered the credit rating of Spain.
The Economist Intelligence Unit (EIU) under the Economist magazine of the UK
has continued to lower its forecast for the economic growth of both the U.S. and the
European common currency zone (Eurozone). EIU has lowered the forecast for the
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Weekly Report
BIDV Securities Company
growth of the U.S. by 2012 down to 1.3% over the previous forecast made in
September/2011 being 2%. For the Europe, EIU has lowered the forecast for the
growth of its GDP down to 0.3% by 2012 over the previous forecast of 0.8%.
China: China Statistical Agency announced that China's economy in the third
quarter of 2011 grew by 9.1% from 9.5% previously. The decreases in the monetary
tightening policy and demands have weakened the economic growth. The growth
rate of the Chinese economy in the third quarter of 2011, therefore, was lower than
the forecast of 9.2% by experts. Hence, the Chinese economy in the third quarter of
2011 grew at the lowest rate in two years. The operators of China are much likely to
consider of introducing more measures to support the economic growth after the
State Council in October/2011 passed the support program for small businesses.
World commodities: Gold prices ended the past week at 1,640 USD/ounce. During
the week, gold prices had a chain of four consecutively decreasing sessions; as of
the whole week, gold prices lost 2.5%, as the week of highest loss in one month. In
the meantime, WTI oil prices stood at 87 USD/barrel, almost unchanged over the
end of the previous week.
The U.S. economic calendar (24/10-28/10)
Monday
Tuesday
Wednesday
Thursday
Friday
-
S&P Case
Shiller HPI
Durable
Goods
Orders
GDP Q3
Personal
Income and
Outlays
-
Consumer
Confidence
New Home
Consumer
Jobless Claims
Sales
Sentiment
FHFA House
Price Index
Pending Home
Sales Index
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Weekly Report
BIDV Securities Company
EQUITY TY
VN-Index technical movements
VNINDEX - Daily 10/21/2011 Open 405.44, Hi 411.79, Lo 405.44, Close 411.03 (1.8%) Vol 22,498,990 MA(Close,10) = 410.64, Mid MA(Close,50) = 424.14, Long MA(Close,100) = 423.61, BBTop(Close,15,2) = 426.21, BBBot(Close,15,2)
520.0
500.0
480.0
460.0
440.0
426.206
424.141
423.614
420.0
411.03
410.645
400.892
400.0
399.08
380.0
March
April
May
Created with -AmiBrok
er - =
adv
anced
c hart
and
technical
analy
sis
sof t ware. htt p:// www.am ibroker.com
VNINDEX
ADX(14)
MACD(12,26)
RSI(15)
=41.97
32.76,
= -7.30,
+DIing
=Signal(12,26,9)
18.58,
-DI =
34.71
= -5.82
Jun
Jul
August
Septem ber
October
HNX-Index technical movements
HNXINDEX - Daily 10/21/2011 Open 67.7, Hi 69.13, Lo 67.7, Clos e 69.13 (2.1%) Vol 30,613,600 MA(Clos e,10) = 69.02, Mid MA(Clos e,50) = 71.72, Long MA(Clos e,100) = 72.33, BBTop(Close,15,2) = 72.28, BBBot(Clos e,15,2)
108.0
102.0
96.0
90.0
84.0
78.0
72.3322
72.2829
72.0
71.7224
70.711
69.13
69.022
67.0504
66.0
March
April
May
Created with AmiBroker
- adv
harting
and
tec hnical
analy
s is=sof
tware. ht tp:/ /www. amibroker.com
HNXINDEX
- RSI(15)
ADX(14)
MACD(12,26)
==anced
42.06
24.95,
=c -1.31,
+DI =
Signal(12,26,9)
18.45,
-DI
= 30.54
-1.07
Jun
Jul
Augus t
September
October
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Weekly Report
BIDV Securities Company
Market Comments
The world market had a quite positive week, leading to the hope for the possibility
of terminating the downtrend. Nevertheless, we would like to highlight that this is
only the first rays of hope, not enough to form a trend. DJIA has overcome the
strong resistance of 11,600 for months, opening up the possibility of no longer being
controlled in a downtrend. This index has, however, not overcome the resistance
much; S & P 500 has not overcome the resistance; simultaneously the markets of
currency, goods have not escaped from the downtrend. According to us, in the short
term, the world market will keep on fluctuating around the resistances but not have
any significant breakthrough. The possibility of a negative impact on the domestic
market is low; in an optimistic case, there may be a positive impact.
After the first 2 days of the week of maintaining at abnormal high levels, the interest
rates in the interbank market have cooled down; but there has not been any signal to
expect for a downtrend for the market. With the problems of the economy and the
financial system, the risks are difficult to decrease down to any level sufficiently
low to to lower lending interest rates (including banks with loans to one another).
This makes the positive signal from the CPI not enough to bring an optimistic
condition to the market because this index is meaningful only to mobilizing interest
rates.
The exchange rate of USD / VND has continued to increase slightly. In our opinion,
it’s hard to expect for any reverse of the exchange rate, at least in the short term.
Come what may, the "room" of increase to 22,000 by the Lunar New Year Festival
has not shown any dangerous sign; thus, to our understanding, the danger from the
exchange rate would not soon become a focus of the market’s attention.
The domestic market had a quite positive week-ending session after two
horizontally-going sessions. However, we believe that it’s not enough to be
optimistic about the possibility where the market will have a reverse. After several
sessions with decreases stronger than reasonable rates, along with the possibility of
reaction to come back to the old bottom, the short break occurred in the market is
normal. HNX Index has not escaped from the down channel. We consider that it’s
necessary for more signals to confirm the termination of the downtrend.
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Weekly Report
BIDV Securities Company
DISCLAIMER
The information, statements, forecasts and projections contained herein, including any expression of
opinion, are based upon sources believed to be reliable but their accuracy completeness or
correctness are not guaranteed. Expressions of opinion herein were arrived at after due and careful
consideration and they were based upon the best information then known to us, and in our opinion
are fair and reasonable in the circumstances prevailing at the time. Expressions of opinion contained
herein are subject to change without notice. This document is not, and should not be construed as, an
offer or the solicitation of an offer to buy or sell any securities. BSC and other companies in the BSC
and/or their officers, directors and employees may have positions and may affect transactions in
securities of companies mentioned herein and may also perform or seek to perform investment
banking services for these companies. This document is for private circulation only and is not for
publication in the press or elsewhere. BSC accepts no liability whatsoever for any direct or
consequential loss arising from any use of this document or its content. The use of any information,
statements forecasts and projections contained herein shall be at the sole discretion and risk of the
user.
RESEARCH DEPARTMENT – BIDV SECURITIES COMPANY (BSC)
TONG MINH TUAN
Department Manager
[email protected]
Nguyen Thi Thu Trang
Economics Analysis
[email protected]
Hoang Anh Tuan
Market Analysis
[email protected]
Nguyen Hoang Viet
Economics Analysis
[email protected]
Tran Huu Quang
Market Analysis
[email protected]
CONTACT INFORMATION
BSC Head Office
10th Floor – BIDV Tower
35 Hang Voi – Hanoi
Tel: 84 4 22206647
Fax: 84 4 22200669
www.bsc.com.vn
BSC Ho Chi Minh Branch
9th Floor – 146 Nguyen Cong Tru Str
District 1, Ho Chi Minh City
Tel: 84 8 3 8128885
Fax: 84 8 3 8128510
BIDV Securities Company (BSC)
No part of this material may be (i) copied, photocopied or duplicated in any form by any mean or (ii)
redistributed without the prior written consent of BIDV Securities Company (BSC)
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