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HCMC market down on global stock fall, capital gains tax
Ho Chi Minh City stocks extended their losses Wednesday as investors, whose sentiments have plummeted due to the continuing international slump and imposition of capital gains tax, continued to sell out.
The VN-Index of 165 companies and four closed-end funds lost 9.38 points, or 2.67 percent, to close at 342.33 points.
Nguyen Hai Son, a broker at FPT Securities Co. in HCMC, said apart from the bad news about global stock markets which undermined investor confidence, the capital gains tax clause that takes effect in January next year has also scared away investors.
The new Personal Income Tax Law seeks to slap a tax of either 0.1 percent on every sale of securities or 20 percent on the whole year’s net profit.
Son added that some investors sold blue chips to book profit, sending them tumbling along with the index.
PetroVietnam Fertilizer and Chemical Joint Stock Co., PetroVietnam Finance Co., Pha Lai Thermal Power, PV Drilling, and Saigon Securities Inc. all declined by almost the daily allowed limit of 5 percent.
Trading volume was 14.9 million as 41 shares advanced, 102 declined and 26 remained unchanged.
But Son predicted the stock market to gain slightly in the next two days. Saigon Thuong Tin Commercial Joint Stock Bank, the exchange’s only listed lender, was the most active stock, with more than 2.5 million shares changing hands.
Foreign investors were net sellers, notching up a net value of more than VND115 billion (US$6.8 million).
World markets hit by company woes Asian and European stock markets were rattled Wednesday by investor fears that the ongoing financial crisis will wreak havoc at the world's biggest companies, analysts said.
Worries that US titan General Motors could go bust have brought into sharp focus the impact of the global credit crunch on corporate America.
In Asia on Wednesday, Tokyo finished down 1.29 percent and Hong Kong dropped 0.7 percent as concerns about plunging corporate profits and the weak global economy weighed on sentiment.
Europe's main markets gained ground, after sinking into the red early on, with London up 1.19 percent and Paris adding 0.67 percent, while Frankfurt was down 0.17 percent.
Thao Vi
Thanh Nien, AFP
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