HÀ NỘI — Việt Nam’s stock market almost lost US$14 billion after two blows on Monday and Tuesday.

The turbulence in the stock market pushed the benchmark VN Index down to 1,011.6 points, a loss of 93 points, or 8.6 per cent, compared to February 2.

Trần Văn Dũng, chairman of the State Securities Commission (SSC), said the local stock market plunged in the last two sessions due to two main reasons, Dũng said in the evening news on national television VTV on Tuesday.

First, Việt Nam’s stock market was adversely affected by volatility in the global market, which also experienced steep decline in recent sessions owing to speculation by major financial institutions that the US Federal Reserve will raise interest rates by three to four times in 2018.

All major stock indices slumped --- Dow Jones fell 4.6 per cent, Nasdaq lost 3.9 per cent, S&P 500 fell 4.1 per cent and Nikkei 225 plunged 9 per cent.

Second, the local stock market has been rising strongly in the last three months and now is a proper time for an adjustment, especially when investors tend to sell out before Tết (Lunar New Year) holidays.

“At this time, I expect investors to be calm and alert and avoid herd behaviour in the depressing global context,” Dũng said.

“The macro-economic fundamentals in the whole economy as well as in Việt Nam’s stock market are bullish. Thus, the market is predicted to continue its strong development this year,” he said.

Major indicators, such as gross domestic product growth and inflation, are well in line with the Government’s targets. Businesses are also performing well, with some 94 per cent of listed companies on the two stock exchanges reporting profits.

VN Index has climbed 32.6 per cent since early November 2017, making it the best-performing market in the world.

Though the local market plummeted sharply in the last two days, market liquidity increased strongly.

The average trading value reached VNĐ13.75 trillion ($603 million) a session in the last two sessions, up 50 per cent over the daily trading value last week.

Even with the sharp decline on Tuesday, foreign investors bought a net value of VNĐ4.2 trillion in the stock market and VNĐ273 billion in the bond market.

Since early this year, foreign traders have been responsible for total net purchase value of VNĐ14.6 trillion in the stock market and VNĐ319 billion in the bond market.

“The influx of foreign capital in the securities market has shown foreign investors’ confidence in the domestic market,” Dũng said.

The VN Index began to bounce back on Wednesday, recouping over 33 points, or 3.3 per cent to nearly 1,045 points, on the HCM Stock Exchange on Wednesday morning. — VNS