next article

Vietnam stocks surge to eight-month high as Bao Viet advances

Vietnam's stocks surged to the highest level in more than eight months amid speculation regulators will ease foreign-ownership limits on some companies.

The VN Index rose 3 percent, the most among Asian benchmark gauges tracked by Bloomberg, to 482.16 as of 12:35 p.m. in Ho Chi Minh City. The gauge was poised for the highest close since May 10. Bao Viet Holdings, the biggest Vietnamese insurer, and PetroVietnam Gas Joint-Stock Co. climbed more than 6 percent.

The VN Index jumped 3.5 percent on Jan. 25, the most since March 5, after the SaigonTimes reported the State Securities Commission may allow some listed companies to raise their foreign ownership limit above the current 49 percent in the first quarter by issuing non-voting shares. The government will continue to support business and focus on tackling bad debt at banks, according to a posting on its website following a Jan. 25 meeting between Prime Minister Nguyen Tan Dung, government advisers and economists.

"It looks like the government is really doing something to bolster the economy, particularly in lifting foreign investment and resolving bad debt," Phan Dung Khanh, a research and investment consultant manager at Maybank Kim Eng Securities Joint-Stock Co., said by phone from Ho Chi Minh City. "Foreign investors have bought a lot and that spurred local investors to buy as well."

Overseas investors bought a net $8.7 million of Vietnamese shares on Jan. 25, the most since Jan. 9, data compiled by Bloomberg show. Foreigners have purchased a net $90 million of stocks in January, poised for the biggest monthly inflows since December 2010, the data show.

Vietnam posted a smaller trade surplus in January with exports exceeding imports by $200 million, according to figures released today by the General Statistics Office in Hanoi. The median estimate of four economists surveyed by Bloomberg News was for a surplus of $109 million.

"We have to see the specifics. This rally is pretty much more on the sentiment side," Attila Vajida, head of institutional clients at ACB Securities Co. in Ho Chi Minh City, said by phone today.