 Shares rebound from ‘Black Monday'
Vietnam News - 8/26/2015 9:40:06 AM
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Vietnamese shares were volatile yesterday, but ended higher as bargain hunters helped the market regain part of Monday's big loss, although the global situation has yet to improve.
Domestic investors were hit hard again early yesterday after the news that both European and the US stocks fell hard following the latest Chinese rout. Although most Asian shares recovered yesterday, China's Shanghai Composite Index dropped another 7 per cent when the market closed.Chinese shares have plunged 15 per cent in the past three days, including an 8.5 per cent decline on Monday."Changes in global markets are too big for Viet Nam not to be affected. The most important thing is if domestic economic factors are strong enough to support market sentiment," said Nguyen Van Quy, an analyst at FPT Securities Co.The benchmark VN-Index on the HCM Stock Exchange recouped 0.58 per cent to close yesterday's session at 529.98 points. The index suffered a loss of 5.3 per cent on Monday, the second time the VN-Index has dropped more than 5 per cent this year.The first occasion was on May 8 during the territorial dispute between Viet Nam and China on the East Sea issue.Shares have lost nearly 17 per cent in value since the peak in mid-December and 14 per cent since August 11, when China devalued its currency.On the Ha Noi Stock Exchange, the HNX-Index also regained 1.27 per cent after a hard fall of 5.81 per cent on Monday. The index also lost 13.4 per cent in the previous two weeks.Nearly US$8 billion worth of market capitalisation was washed from the two markets in two weeks after China's currency devaluation."The market fell hard early this morning, rebounded at noon but declined again in the early afternoon's session. It ended higher by day-end, which showed the psychology of fragile investors," Quy said.In HCM City, bargain investors increased buying yesterday, keeping liquidity at a good level. Almost 178 million shares worth VND2.8 trillion ($124.4 million) were traded by the end of the session, higher than the monthly average volume and value of nearly 120 million shares and VND2.12 trillion ($95.6 million) in August.The overall market condition was neutral with 118 stocks rising, 117 declining and 75 closing unchanged.Large-cap companies led the market uptrend, especially banks after the Deputy Governor of the State Bank of Viet Nam, Nguyen Thi Hong, said yesterday morning the central bank would not devalue the dong further this year.Hong said the latest depreciation of 1 per cent and an expansion of the dong's trading band from 2 per cent to 3 per cent two weeks ago weighed the impacts of both the yuan devaluation and the impending interest rate hike by the US Federal Reserve (Fed).Six of total nine listed banks gained value yesterday. Rises ranged from between 0.7 per cent to more than 4 per cent. One closed unchanged and two declined.Asia Commercial Bank (ACB) was the biggest gainer with a rise of 4.1 per cent. Sacombank (STB) led the losers with a drop of 2.5 per cent."Tomorrow's trade will be very important. If the Index continues to move at about 510-530 points, as it did today, it will signal that the market is stabilising and ready for a more stable recovery," Quy said.However, he warned investors not to try to predict the bottom now as the support information was still weak and global factors remained volatile that can make the market development unpredictable.
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