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Vietnam – Daily Market Recap Oct 29

Daily Market Recap 29/10/2020    287

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Dear Valued Clients,

We would like to send you our Daily Market Recap for today

Market Commentary: The VN-INDEX extended the losing streak with 0.2% decrease

The VN-INDEX recorded its fourth consecutive fall as Financials and Consumer Staples large caps lost ground today. Following the U.S. stock market sell-off, the VN-INDEX opened in a pessimistic manner and easily lost ground. Later, the index gradually fell to its intraday low at 914.3pts (-0.7%) before slightly recovering in the ATC session. The index was dragged down mainly by Financials stocks including CTG (-2.7%), BID (-1.7%), VCB (-0.7%), and TCB (-2.7%), together wiping 2.8pts off the VN-INDEX. The momentum was fueled further by MSN and VNM, which fell 2.3% and 0.5%, respectively. On the positive side, the Vingroup related stocks showed support to the index with VIC, VHM, and VRE rising 0.5%, 0.8%, and 0.4%, respectively, followed by other index movers of GVR (+2.2%) and PLX (+1.5%). At the end of the session, the VN-INDEX slightly decreased 0.2% to close at 919.1pts, the lowest since the 06 Oct, while the HNX-INDEX slightly rose 0.3% to 134.4pts.

Energy (+1.3%), Health Care (+0.8%), and IT (+0.5%) rose, while Utilities (-1.1%), Consumer Discretionary (-0.8%), and Consumer Staples (-0.8%) lost ground today. Top index movers included VHM (+0.8%), VIC (+0.5%), GVR (+2.2%), PLX (+1.5%), and STB (+3.1%). Top index laggards consisted of CTG (-2.7%), BID (-1.7%), MSN (-2.3%), VCB (-0.7%), and TCB (-2.7%). Top three major put-through transactions were HAG with 64.1m shares (VND307.6bn), VIB with 1.2m shares (VND38.4bn), and SHI with 4.5m shares (VND36.8bn).

Foreigners net sold on HOSE to the amount of VND334.7bn, and also net sold on HNX to the amount of VND6.4bn. They mainly bought HPG (VND91.4bn), VIC (VND88.7bn), and VNM (VND53.8bn); and mainly sold MSN (VND368.0bn), VIC (VND106.6bn), and VNM (VND76.6bn).

Market News

Oil falls to four-month low as renewed lockdowns menace demand

Oil fell to a four-month low, deepening Wednesday’s slump as lockdown restrictions grow in Europe. Futures in London lost 3.9%, declining as the dollar reversed an earlier loss to trade higher. Germany and France, the European Union’s two biggest economies, will clamp down on movement for at least a month to try and curb Covid-19’s spread. There are already signs that road use in Europe is slumping, weighing on oil consumption. (Bloomberg)

VN Taxation body missing out on taxes from sharing-economy businesses

Businesses following the sharing economy model are facing problems in tax declaration. Amid the lack of regulations, the taxation body may be taxing inaccurately or missing taxpayers. The Ministry of Finance (MOF) says the current tax laws don’t differentiate between businesses following the traditional way and the businesses following a sharing economy model. The tax imposition and collection on sharing economy businesses are implemented in accordance with VAT, Corporate Income Tax and Tax Management Laws. However, the ministry admitted that the businesses which have headquarters overseas while doing business in Vietnam and earning revenue in Vietnam, only pay corporate income tax under direct mode. Vietnam cannot manage the input cost overseas as they don’t have permanent offices in Vietnam.

The tax management on overseas e-commerce platforms is ‘extremely difficult’ as admitted by MOF. International practice shows that there should be international cooperation among countries. It is necessary to join tax management forums or create regional tax management forums so as to obtain agreements on information providing and sharing. Therefore, OECD’s tax management forum is building a draft code of conduct for the sharing economy, which clearly states the content and coordination solutions among countries for effective tax management. Meanwhile, MOF plans to propose to the government new regulations to restrict cash payments for online transactions. Service providers would only accept payments via banks or intermediaries with bank transfer. (Vietnamnet.vn)

Notable Corporate Events

GTNfoods JSC (GTN VN, HOSE) – Business results: GTN’s 9M20 revenue plunged 6% yoy to VND2,144bn, while its after-tax profit jumped 174% yoy to VND176bn. The company said 9M20 profit gain came from more efficient cost management. (Ndh.vn)

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