Number of new accounts continue to fall last month

November 10, 2022 - 08:33
This was the lowest number of new accounts opened by domestic investors since February 2021 and marked the fifth consecutive month of decline.
Investors watching the market's movement on computers. Photo

HÀ NỘI — On the stock market, domestic investors opened 96,427 new accounts in October, a slight decrease month-on-month, data from the Vietnam Securities Depository (VSD) showed. 

This was the lowest number of new accounts opened by domestic investors since February 2021 and marked the fifth consecutive month of decline.

Specifically, retail investors opened 96,290 new accounts, while institutional investors opened 137. 

Over the first nine months of the year, domestic retail investors opened 2.4 million new accounts, far exceeding the combined figure of 2018, 2019, 2020 and 2021.

As of the end of September, retail investor accounts exceeded 6.65 million, or about 6.6 per cent of the population. 

The number of new accounts opened by domestic investors continuously declined sharply, which also partly affected the stock market's liquidity recently. 

According to statistics, last month, the average matching value on the Hồ Chí Minh Stock Exchange (HoSE) was only VNĐ9.3 trillion (US$374 million), a 21 per cent decrease compared to the previous month and the lowest level since the beginning of 2021. Moreover, many trading sessions' matching values didn't reach VNĐ7 trillion.

The move to hike interest rates by the US Federal Reverse (Fed) and the global central banks left a huge impact on the cash flow in the global financial market. 

Furthermore, under the exchange rate pressure due to the escalating US dollar, the State Bank of Vietnam (SBV) also raised the operating interest rate by 1 per cent per year for the second time within a month. In addition, businesses' bond repurchasing before maturity also partly affects cash flow into securities.

The aggressive tightening policy of the Fed has also created a wave of capital withdrawal globally, and Việt Nam is no exception. Statistics show foreign investors net sold nearly VNĐ1.6 trillion on HoSE in October. This is the second straight month that foreign investors have sold strongly. Last month's figure was more than VNĐ3 trillion.

Last month, foreign investors opened 174 new accounts, of which 162 new accounts were opened by retail and 12 new accounts by organisation investors. The numbers were much more positive than foreign retail investors closing 63 accounts in September. 

As of the end of October, foreign investors had a total of 42,242 accounts.

SSC fines hundreds of cases

Regarding the supervision and handling of violations in the stock market, the State Securities Commission (SSC) issued 51 sanctioning decisions with a total fine of VNĐ3.3 billion last month.

For the year, SSC has issued 401 sanctioning decisions with a total fine of more than VNĐ30 billion.

Previously, at the Government press conference on October 29, Deputy Minister of Finance Nguyễn Đức Chi said that the macro balances of the Vietnamese economy remain stable, which is the basis for stabilising the stock market. 

The Vietnamese stock market witnessed a downward correction.

Chi said that international and domestic factors such as rising global inflation, the world economy and the changes in the monetary policy of major economies, the ongoing Russia-Ukraine conflict, and changes in domestic monetary policies are attributed to the bearish trend.

A press release recently released by the Ministry of Finance said that on October 31, the VN-Index fell 9.2 per cent on-month to 1,027.94 points. The HNX-Index on the Hà Nội Stock Exchange (HNX) closed last month at 214.31 points, down 14.4 per cent over the previous month. 

As of October 27, the market capitalisation of the three stock exchanges HOSE, HNX and UPCoM were estimated at VNĐ5.34 quadrillion, down 31 per cent compared to the end of 2021, and equivalent to 63.6 per cent of GDP. VNS