Vietnam Daily Market Recap Oct 20

Stocks plunge amid corporate bond market concerns

The VN-Index plunged on Monday by 5.5% to 1,636.4, the biggest one-day decline so far this year. Market liquidity surged, with total trading value rising 26.3% compared to Friday to VND50.5tn (USD1.9bn). The HNX Index followed a similar pattern, posting a loss of 4.7% to close at 263.1.

Investors dumped shares today as the Government Inspectorate uncovered a series of violations in bond issuance by five banks, 37 joint stock companies, and 25 limited liability companies. According to the Government Inspectorate’s conclusion, Novaland Group and three of its subsidiaries — Unity, Aqua, and Lucky House — committed violations in corporate bond issuance. After receiving proceeds from the bond sales, individuals transferred about VND7.08tn (USD269mn) to Nova Housing Business JSC for use. Given serious signs of violations in the use of bond proceeds, the Government Inspectorate has referred all information related to Novaland Group and its four subsidiaries, as well as indications of misuse of funds, to the Ministry of Public Security for further investigation and handling under its authority.

Almost all sectors declined today, led by Financial Services (-6.9%), Banks (-5.8%), Real Estate (-5.6%) and Basic Resources (-5.8%), while only Telecommunications gained (+3.9%).

Most stocks hit their floor prices today. Top laggards included VIC (-4.5%), VHM (-6.9%), VCB (-4.4%) and TCB (-6.9%). The top performer today was VTP (+4.5%)

Foreign investors net sold today with VND2.14tn (USD81.2mn), with selling momentum focused on MSN (VND652.4bn, USD24.8mn), CTG (VND269.1bn, USD10.2mn), STB (VND221.5bn, USD8.4mn), and SSI (VND175.3bn, USD6.7mn), while foreigners mainly bought VIX (VND122.1bn, USD4.6mn), DIG (VND118.9bn, USD4.5mn), and VJC (VND113.5bn, USD4.3mn).

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