ID :
20084
Thu, 09/18/2008 - 22:05
Auther :
Shortlink :
http://m.oananews.org//node/20084
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US economic tide washes into Vietnam
Hanoi (VNA) - Share prices plunged on Sept. 17 as investors continued to be seriously affected by the US financial crisis.
The Ministry of Finance's adjustment to the price of diesel, which greatly
affects enterprises' production and business results, was not
confidence-boosting enough to prevent huge sales in both the Hanoi and
HCM City indices.
Diesel was slashed by 450 VND per litre to a price of between
15,450-15,500 VND (0.936-0.939 USD) on Sept. 16, a day after Lehman Brothers
filed for bankruptcy protection and Merill Lynch agreed to sell itself to
Bank of America.
The HCM Stock Exchange slumped 18.71 points on Sept. 17, or 4.1 percent,
to close at 437.24. Trading volume fell by 15 percent to 13.6 million
shares, with a total turnover of 517.6 billion VND (31.37 million USD).
The southern bourse saw 149 losers, with almost all stocks hitting the
floor of the regulated trade band.
Three companies considered to be among the top 20 domestic listed firms
with the highest credit rating last year, Binh Dinh Minerals (BMC), the
Corporation for Financing and Promoting Technology (FPT) and Vincom Joint
Stock Company (VIC), were no exception to the downturn. The credit ratings
conducted by the Credit Information Centre and leading global credit-rating
corporation Dun&Bradstreet, were released on Sept. 16.
FPT was the biggest loser, falling 5.2 percent. This was followed by BMC
with 5.05 percent and Hau Giang Pharmaceuticals (DHG) with 4.95 percent.
Sacombank (STB), however, saw the most active with 2.55 million shares
traded, followed by Phu My Fertilisers (DPM) with 1.4 million.
Foreigners bought 2.78 million shares and unloaded 3.46 million, with net
sales value slightly narrowed to 35 billion VND (2.12 million USD) from
Sept. 16's 40.2 billion VND (2.44 million USD).
At Hanoi Securities Trading Centre, the HASTC-Index slipped 10.34 points,
or 6.67 percent, to end at 144.74. About 7.9 million shares changed hands
for a total value of 289.6 billion VND (17.55 million USD).
Asia Commercial Bank (ACB) led the market in terms of trading volume, with
1.45 million shares.
It might take several months to see the true impact on domestic businesses
of the collapse of Lehman Brothers. "However, US bank collapses and a series
of other troubles in the US financial market have had immediate affects
on investors' psychology," said Phan Duc Trung, general director of FPT
Capital.
"It's natural that the market goes down when investors are concerned, and
there is a domino effect in their psychology," said Le Dinh Ngoc, general
director of Thang Long Securities.
Ngoc said the decline in share prices will not last long even though the
market dropped so deeply over the past week; there were still positive moves
such as the slash in diesel price on Sept. 16.
"In the global recession, financial institutions will have to revise their
investment portfolios as well as investment strategies; this may lead to
adjustments in the investment influx into the domestic capital market," said
Vo Tri Thanh, an economist from the Central Institute for Economic
Management.
Economic conditions remained uncertain despite some improvements in
inflation, trade deficit and bank liquidity over the last few months.
The inflation rate is expected to reach 26-29 percent at the end of this
year, and the trade deficit was estimated to reach around 20 billion USD,
said Thanh.
Maintaining economic stability should be priority now, along with keeping
investors' confidence, said Thanh.
Financial institutions should attach special importance to risk
management, while the Ministry of Finance, the State Bank of Vietnam and
the State Securities Commission should tightly supervise the financial
market.
The Asia Development Bank recommended on Sept. 16 that the Government
continue concentrating on curbing inflation until it is reduced to
single-digit levels, rather than focusing on stimulating growth.
"While global and regional economies are deepening, high growth in the
short term would result in higher inflation and bigger trade deficit, with
the result that the situation would be even more difficult to deal with in
2009," said Ayumi Konishi, ADB country director for Vietnam .-Enditem
The Ministry of Finance's adjustment to the price of diesel, which greatly
affects enterprises' production and business results, was not
confidence-boosting enough to prevent huge sales in both the Hanoi and
HCM City indices.
Diesel was slashed by 450 VND per litre to a price of between
15,450-15,500 VND (0.936-0.939 USD) on Sept. 16, a day after Lehman Brothers
filed for bankruptcy protection and Merill Lynch agreed to sell itself to
Bank of America.
The HCM Stock Exchange slumped 18.71 points on Sept. 17, or 4.1 percent,
to close at 437.24. Trading volume fell by 15 percent to 13.6 million
shares, with a total turnover of 517.6 billion VND (31.37 million USD).
The southern bourse saw 149 losers, with almost all stocks hitting the
floor of the regulated trade band.
Three companies considered to be among the top 20 domestic listed firms
with the highest credit rating last year, Binh Dinh Minerals (BMC), the
Corporation for Financing and Promoting Technology (FPT) and Vincom Joint
Stock Company (VIC), were no exception to the downturn. The credit ratings
conducted by the Credit Information Centre and leading global credit-rating
corporation Dun&Bradstreet, were released on Sept. 16.
FPT was the biggest loser, falling 5.2 percent. This was followed by BMC
with 5.05 percent and Hau Giang Pharmaceuticals (DHG) with 4.95 percent.
Sacombank (STB), however, saw the most active with 2.55 million shares
traded, followed by Phu My Fertilisers (DPM) with 1.4 million.
Foreigners bought 2.78 million shares and unloaded 3.46 million, with net
sales value slightly narrowed to 35 billion VND (2.12 million USD) from
Sept. 16's 40.2 billion VND (2.44 million USD).
At Hanoi Securities Trading Centre, the HASTC-Index slipped 10.34 points,
or 6.67 percent, to end at 144.74. About 7.9 million shares changed hands
for a total value of 289.6 billion VND (17.55 million USD).
Asia Commercial Bank (ACB) led the market in terms of trading volume, with
1.45 million shares.
It might take several months to see the true impact on domestic businesses
of the collapse of Lehman Brothers. "However, US bank collapses and a series
of other troubles in the US financial market have had immediate affects
on investors' psychology," said Phan Duc Trung, general director of FPT
Capital.
"It's natural that the market goes down when investors are concerned, and
there is a domino effect in their psychology," said Le Dinh Ngoc, general
director of Thang Long Securities.
Ngoc said the decline in share prices will not last long even though the
market dropped so deeply over the past week; there were still positive moves
such as the slash in diesel price on Sept. 16.
"In the global recession, financial institutions will have to revise their
investment portfolios as well as investment strategies; this may lead to
adjustments in the investment influx into the domestic capital market," said
Vo Tri Thanh, an economist from the Central Institute for Economic
Management.
Economic conditions remained uncertain despite some improvements in
inflation, trade deficit and bank liquidity over the last few months.
The inflation rate is expected to reach 26-29 percent at the end of this
year, and the trade deficit was estimated to reach around 20 billion USD,
said Thanh.
Maintaining economic stability should be priority now, along with keeping
investors' confidence, said Thanh.
Financial institutions should attach special importance to risk
management, while the Ministry of Finance, the State Bank of Vietnam and
the State Securities Commission should tightly supervise the financial
market.
The Asia Development Bank recommended on Sept. 16 that the Government
continue concentrating on curbing inflation until it is reduced to
single-digit levels, rather than focusing on stimulating growth.
"While global and regional economies are deepening, high growth in the
short term would result in higher inflation and bigger trade deficit, with
the result that the situation would be even more difficult to deal with in
2009," said Ayumi Konishi, ADB country director for Vietnam .-Enditem
