VN-Index follows falling global market

Hanoi (VNA) - Vietnam 's stock markets dropped again last week, matching the downward global trend due to the instability of the world economy.

The VN-Index saw the strongest decrease since its five percent trading
band was implemented on August 18.

Last week's sessions saw decreases every day. The week finished with
Friday's trading session ending at 379.06, 18.62 points lower than on
Thursday.

On October 8, for the first time in seven years, the Bank of England cut
interest rates to 4.5 percent from 5 percent, Other central banks
followed suit in a global effort to offset economic damages from a
deepening financial crisis. The European Central bank cut its rate to 3.75
from 4.25 percent, and the FED cut the interest rate 0.5 percent further to
1.5.

With the significant downward plunge of stock markets, some countries
decided to close their markets to avoid a collapse. Turmoil in Wall Street
has spread all over the world.

Members of the Vietnam Banks Association met and agreed for its regular
meeting last week and agreed on a plan to cut short term deposit rates.
Further rate cuts will depend on the mobilising capacity of the banking
system in coming weeks and on inflation.

Last week foreign investors continued selling massively with a net sell of
308 billion VND (18 million USD). During trading on Thursday and Friday, the
selling value was two times more than the buying value.

Sell-off volume was the most for DPM with more than one million shares,
followed by PetroVietnam Tourism and Services Joint Stock Co (PET) with
500,000 shares, Hoa Binh Construction (HBC) with 440,000 shares and PPC with
200,000 shares.

Last week's stock market performance demonstrated that global stock market
action was also affecting the mindset of domestic investors. The domestic
consumer price index, GDP and business performance results of listed
companies would not be too affected by the long lasting difficulties in
global financial markets, predicted Le Tham Duong of the HCM City-based
Banking University. Despite his optimism for the domestic economy, however,
Duong forecast that due to anxious investors the VN-Index would slide
further.

At the Hanoi Securities Trading centre, the HASTC-Index also saw strong
decreases with the last session dropping 32.15 points to end at 119.87
points. An average of 9.3 million shares changed hands each trading session
for a turnover worth 291 billion VND (17.3 million USD).

During the 5 trading sessions, the HASTC-Index saw only one day of gains,
and the downtrend seemed to continue. The HASTC-Index declined to the
maximum allowed with the trading band, especially on Friday when the index
decreased by 7.28 percent. The total trading volume last week was also
reduced. However, it seemed to recover somewhat during the end of the week,
thus improving the liquidity of the market.-Enditem