Tuesday, December 12 2017

VietNamNews

Indices tumble on ACB fears

Update: September, 24/2012 - 10:03
Investors at the Bao Viet Securities. Both indices tumbled after selling pressure last week. — VNS Viet Thanh
HA NOI (VNS)— Both indices tumbled after great pressure to sell last week caused by some negative information, mostly related to Asian Commercial Bank (ACB).

The Ministry of Public Security prosecuted bank millionaire Nguyen Duc Kien, the co-founder of the bank, of fraudulent appropriation of property. In addition, two accomplices were found: the director and chief accountant of ACB Ha Noi Investment Company.

In addition, ACB chairman Tran Xuan Gia resigned from the management board along with two vice presidents, citing personal and health problems. However, according to the bank, these officials played some part in former CEO Ly Xuan Hai's decision to authorise 19 ACB employees to deposit VND718 billion (US$34.19 million) belonging to the bank at another lender.

Only one day later, vice chairman of Eximbank (EIB) Pham Trung Cang submitted his resignation. Cang was said to be involved in some of ACB's activities.

"However, despite continuing turmoil in the banking system in general and within ACB in particular, the impact on the stock market is gradually wearing off," said FPT Securities analyst Le Thi Bich Hang. The majority of small investors had calmed down instead of halting investment in stocks, she added.

Meanwhile, Ha Noi's consumer price index in September unexpectedly rose 2.47 per cent compared to August, while the index for HCM City also increased 1.21 per cent. The remarkable increase was caused by recent hikes in fuel price.

On the HCM City Stock Exchange, the VN-Index ended last week at 395.48 points, losing 0.85 per cent over the previous Friday's close. Trading value averaged VND936.3 billion ($44.5 million) per session, jumping 53 per cent compared to the preceding week's level.

Although the VN-Index declined strongly in some sessions towards the middle of last week, it rebounded dramatically on Friday. Bottom-fishing came back to most large-cap stocks, reducing the risk of further declines, said analyst Nguyen Quang Minh for the financial information website vietstock.vn.

"Liquidity improved," he added, "a crucial factor to strengthen the possibility of growth." Liquidity will be closely monitored this week.

Meanwhile, the HNX-Index on the Ha Noi Stock Exchange retreated 4.25 per cent to just 56.71 points. Market value reached an average figure of VND319 billion ($15.19 million), increasing 52 per cent over the previous week. However, this level was still low.

Last Friday' session was the last day for ETF Market Vectors Viet Nam and FTSE Viet Nam Index to finalise their investment portfolios. Transactions of these funds promoted bluechips to their ceiling prices. The total net buys of foreign investors on the southern exchange last week hit VND207.3 billion, concentrating on insurer Bao Viet (BVH) with VND87.3 billion, followed by Sacombank (STB) with VND70.3 billion and Vietcombank (VCB) with VND61.4 billion.

Shares of up to 23 of the 24 industries declined last week. The mining, securities, construction and banking sectors dropped between 3-6.2 per cent. Insurance was the only rallying sector, rising 14 per cent, thanks to positive trades on BVH.

Technically, the VN-Index is forming an increasing model, Maritime Bank Securities Co analysts wrote in their weekly report. Therefore, shares should recover this week, creating opportunities for short-term investors.

"Investors may consider buying bank stocks such as ACB, EIB and VCB." — VNS

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