Suspecting insider trading, Vietnamese government to review volatile stock market

Vietnam’s Deputy Prime Minister Vuong Dinh Hue has demanded relevant authorities to find out why the country’s stock market has been so volatile over the past few months, which is hurting the economy.

Aside from objective market analysis, the deputy PM requested analysts to look into all other possible factors to ascertain whether there’s been any insider trading.

Prices of Vietnamese shares are no longer cheaper than those of regional peers, causing market growth to slow down and making it less attractive to foreign investors, Hue told a meeting in Hanoi on Friday.

The benchmark VN-Index on the Ho Chi Minh Stock Exchange (HOSE) closed at 1,120 points on February 28, up a staggering 14 percent from the beginning of the year, which was the biggest gain worldwide.

On March 22, Vietnam's stock market rose by 0.92 percent to close at more than 1,180 points, surpassing the record of 1.179 points set in 2007.

But just a day later, it left the 11-year record and fell to 1,147 points.

On the closing session of March, VN-Index rose 19.33 percent against the start of the year to 1,174 points and maintained its leading position among the fastest growing markets in the world.

But then the stock market plunged in April.

On April 26, one day before the closing session of the month, Bloomberg said Vietnam, Asia’s top stock market this year, is about to become the world’s worst performer of the month.

The fall on April 26 brought the average drop in April to 11 percent, on course for its worst monthly performance in seven years. The decline wiped off more than $15 billion from the nation’s market capitalization, it said.

As a result, Vietnam fell to second place among the fastest growing stock markets in the world.

On the last working day of 2017, it closed at a 10-year high of 984.24, earning Vietnam the nickname Asia’s “frontier market”.