Moody's downgrade hits shares
HA NOI – (VNS) Shares closed the week down on both exchanges yesterday, following the news that the international ratings agency Moody's downgraded the credit ratings of eight Vietnamese banks.
Moody's also downgraded Viet Nam's government bonds from B1 to B2, citing weaknesses in its banks and a stuttering economy.
"With this information, cash flow will likely stay away from the market due to concerns about the likelihood of continued downward trends in the short term," FPT Securities Co's analysts commented in a report yesterday. In addition, the news of a start to prosecutions of Tran Xuan Gia and three other former high-rank officials at Asia Commercial Bank (ACB) partially had a negative impact on investor sentiment during the early session, said Nguyen Xuan Binh, an analyst from Bao Viet Securities Co.
Banks were mixed yesterday, with Vietinbank (CTG), Vietcombank (VCB), Military Bank (MBB) and Sai Gon-Ha Noi Bank (SHB) declining from 0.8-2 per cent; but Eximbank (EIB), Asia Commercial Bank (ACB) and Sacombank (STB) all rose slightly. STB was also the most active code this morning on the HCM City exchange with 1.4 million shares changing hands, closing 0.5 per cent up at VND20,000 (US$0.95) a share.
On the HCM City Stock Exchange, the benchmark VN-Index fell 0.2 per cent to 392.57 points. Value of trades improved 19 per cent over Thursday, totalling VND691.3 billion ($32.9 million) on a volume of more than 37 million shares.
Most blue chips slumped, driving the VN30, which tracks the top 30 shares by market capitalisation and liquidity, down 0.41 per cent to 456.48 points.
On the Ha Noi Stock Exchange, the HNX-Index finished the whole losing week at 55.47 points, down another 0.77 per cent from Thursday's close.
Trading was still weak as just 19.3 million shares worth VND149 billion ($7.1 million) were traded.
PetroVietnam Construction (PVX) was still the most active code on the northern bourse with 2.65 million shares changing hands, but shares closed off another 4.4 per cent to VND4,400 a share. — VNS