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Stock market suffers under large sell offs
Investors caused poor performances in the stock market last week by mostly selling shares in every session.
The VN-Index dropped past the sentimental 500-point mark to 476.00, a slump of 12.93 per cent, with most stocks and fund certificates falling by large amounts.
The heaviest decline of the week was DDM of Dong Do Maritime, with a loss of 24.08 per cent at VND35,000, followed by SAM of Cables and Telecom Materials and FPT of the Corporation for Financing and Promoting Technology, with slips of 23.74 and 23.72 per cent, respectively.
Purchases became significant early last week, but got weaker at the end, though some stocks avoided the common falling trend, including SGC of Sa Giang Import-Export, who added 26.92 per cent to VND23,100, and SDN of Dong Nai Paint, who upped 12.78 per cent to VND25,600.
"Realising the sales were continuing, investors delayed their purchases to wait for lower share prices," said veteran investor Nguyen Cuong at Thien Viet Securities.
Cuong also said that sales mostly aimed at earning money when listed share prices were profitable. A new source of stock would also be pumped into the market next time, encouraging investors to mobilise money for them.
As selling orders covered the most transactions, market liquidity became poor on Thursday and Friday, at only half that of earlier in the week.
About 123.4 million shares changed hands in total, generating a turnover of VND4.33 trillion (US$262.42 million). STB of Sacombank contributed most to this volume figure with 18.95 million shares.
Foreign investors bought 10.63 million shares and sold 12.3 million.
Some news on the local market last week was the lower position of Vietnam in the World Bank's Doing Business 2008 ranking, the return of the 5 per cent import tax on petroleum made by the Finance Ministry and the positive consideration from ANZ and Morgan Stanley on the Vietnamese economy for the remainder of 2008.
"I thought that the Finance Ministry's decision impacted investors' actions the most last week, as it discouraged them from hoping for a lower petroleum price on the domestic market," said Agribank Securities analyst Dao Van Khanh.
Khanh also said that investors were worried about the lower-than-expected business results given by listed firms this quarter due to the petroleum price, adjustment over the last few months.
According to Vincom Securities, the VN-Index this week could reach the 430-point mark. "The index will possibly go up again after reaching this point, as it has done before." In the same prediction, the brokerage set 133 points as the lowest level of HASTC-Index this week.
The HASTC-Index of Ha Noi Securities Trading Centre last week slumped 15.08 per cent at 160.62. The centre saw 63.67 million shares change hands, with a total turnover of VND2.52 trillion ($152.72 million).
ACB of Asia Commercial Bank was calculated to be the biggest decliner of the week, dumping 43.56 per cent at VND53,900, due to its deadline for bonds to be converted into corporate shares.
Following ACB was KKC of the Produce and Trading Metal Joint Stock Company, down 29.83 per cent, and RCL of Cho Lon Real Estate, down 28.75 percent.
Meanwhile, penny stocks were the biggest gainers of the week, including SRA of Sara Vietnam (20.53 per cent and HJS of Nam Mu Hydropower (18.79 per cent).
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