Vietnam’s stock market falls from 1,000 points

By Anh Minh   May 22, 2018 | 01:29 am PT
Vietnamese Deputy Prime Minister Vuong Dinh Hue demanded relevant authorities to find out why the stock market has been so volatile over the past few months.

Vietnam’s stock market fell by 2.86 percent on Tuesday to close at more than 985 points, marking the very first time it has dropped from the level of 1,000 points and higher since the beginning of this year.

The benchmark VN-Index on the Ho Chi Minh Stock Exchange (HOSE) hit 984.24 on the last trading day of 2017, the highest ever since 2007, before reaching 1,000 points in early January.

As many as 28 blue chips saw their points dropping in the trading session on Tuesday afternoon.

There were only 58 companies gained points on the stock market and as many as 257 others lost points by the closing time.

Vietnam’s Deputy Prime Minister Vuong Dinh Hue last Friday 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.

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.

RongViet Securities Corporation in Saigon said in a report in February that the VN-Index will increase by at least 17 percent this year, and even 67 percent in its best scenario, meaning it could end the year somewhere between 1,170 and 1,640.

Nguyen The Minh, a senior analyst at Saigon Securities Incorporation, said “the VN-Index could reach 1,050 points in the short term and 1,300 by the year-end.”

He said the 2017 market was driven by consumer goods stocks, but banking and energy will take the lead this year.

Minh added that the market will also receive a boost from foreign interest this year. Foreign investors made more than $1 billion in net purchases last year, the highest figure in five years, and they are likely to stick around for more privatization of public giants.

In its latest report, Bao Viet Securities said the VN-Index could even reach 1,182-1,187 in the coming sessions.

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