Though there were more trading sessions that saw the VN Index increases than the sessions that saw the VN Index decreases, the market still fell down slightly in the last week. This was the third consecutive week that saw the VN Index down.
The stock market last week bore the influence by the State Bank of Vietnam’s (SBV) decisions on limiting the loans funding securities investment deals, and raising the compulsory reserve ratio. Experts have predicted that with the new decisions, a big amount of money will be withdrawn from the market.
Responding to the SBV’s moves, the prices of shares on the stock market decreased slightly last week. The VN Index fell slightly to below the 1,050 point threshold. 60 share items saw the prices decrease, 39 items saw the prices increase, while other 8 items were stabilized in prices.
On June 11 transactions, VGP was the share item which saw the biggest decreases (- 4.96%), VFMVF1 fund certificate was down by 2.4% in prices to VND32,600/certificate, while PRUBF1 down by VND200 (1.5%) to VND13,100.
The trading sessions on June 12 witnessed the VN Index falling down to the deepest low in the last one month, 1,036.54 points.
The VN Index bounced back on June 13 after three consecutive sessions of falling down, while the downturn was still seen at the Hanoi Securities Trading Centre (HASTC).
What surprised investors most was that the share prices of BMC and TCT, which had been increasing sharply since the beginning of the year, fell down dramatically last week. BMC prices decreased by VND27,000/share to VND520,000, while TCT decreased by VND20,000 to VND386,000
Analysts said that the news that the management authorities would examine the unusual price increases of BMC and TCT have forced the prices down.
The VN Index rose slightly on June 14 after two trading sessions of staying at below 1,040 points and kept rising on June 15, closing at 1,048.19 points.
Analysts said that the VN Index slightly recovered because share prices have reduced by 11% already. Besides, investors remain optimistic about the stock market after hearing the news that Japanese investors open more accounts to make securities transactions in Vietnam. Experts have predicted that many foreign investment funds would enter Vietnam after Vietnamese President Nguyen Minh Triet’s visit to the US in order to strengthen the economic ties between the US and Vietnam.
The total trading value was VND3,042bil ($190,12mil) last week, or VND608bil ($38mil) a day. Some 29.4mil securities were traded in the last five trading sessions, or 5.88mil units a session.
Regulation on foreign securities investors control to be enacted
The State Securities Commission (SSC) is drafting the regulation on foreign investors control which is expected to be promulgated in June. SSC is also considering terminating the authorized investment in Vietnam’s stock market via individuals in Vietnam.
The news was given by Nguyen Thi Lien Hoa, Deputy Chairwoman of SSC at the workshop on portfolio investment encouragement and management held in Hanoi on June 15.
Mrs Hoa said under the new regulation, competent agencies will grant trading codes to foreign investors, and ask to give reports on foreign investors’ transactions. Foreign investors have to provide necessary information to the management authority when they come to make
investments in Vietnam.
From the fourth quarter of 2006 to the first quarter of 2007, the portfolio investment into the stock market has been increasing sharply, which has made difficulties for the management authority.
The appearance of many foreign investors, who have big capital and professional investment method, has helped the stock market become more bustling. However, the state management authority has discovered more and more violations committed by foreign investors, which mainly relate to the information exposure. Many investors were found as making reports slowly and providing inadequate information, making the management work more difficult.
Source: VNE
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