Another bustling trading session was seen on August 22, when nearly 1 billion shares were traded at the HCM City Stock Exchange (HOSE). If counting the stocks traded on all three bourses, the figure would be 1.2 billion. The trading scale of billions of dollars per session was maintained.

On that day, the VN Index sometimes decreased by 25-30 points, but recovered at the end of the session, while electronic boards were lit green with the price surpassing the 1,180-point threshold thanks to very high demand, especially for bank and securities company shares.

Securities company shares were the focus at the August 22 trading session with a series of shares increasing sharply in prices. SSI share prices, for example, increased by 6.4 percent, with 52 million shares transferred, a rarely seen high.

Other securities companies’ shares, including VCI, SHS, MBBank Securities and VNDirect, also saw 3-5 percent price increases.

Prior to that, on August 18, HOSE set a new record with 1.6 billion shares matched, the highest level in the history of the Vietnamese stock market. The total value of transferred stock was $1.5 billion.

The record on HOSE was set when the VN Index lost 55 points, or 4.5 percent, decreasing to 1,177.99 points. The prices of hundreds of shares decreased to floor prices and the capitalization value on HOSE dropped by $9 billion to $195 billion.

Securities companies’ stocks gained significantly recently when the stock market became bustling again in recent months and enjoyed double benefits from the stock market in general and the increased liquidity on all three bourses.

Investors are excited about the news about the KRX transaction system with the South Korean modern technology platform to be put into operation in late 2023.

The system is hoped to bring new products, and transaction and payment solutions to the Vietnamese stock market, such as intraday (T+0), short selling, payment time shortening, and option contract. KRX is also considered a premise for the upgrading of the Vietnamese stock market.

Stock market to attract cash flow by year end?

The events in the last few days in the stock market raised a question if there is a bottom-fishing cash flow in the stock market. Many investors thought about this in the context of the sharp fall in deposit and lending interest rates, and the low volume of capital pumped into the national economy.

According to the State Bank of Vietnam, the lending of the banking system unexpectedly saw a minus growth rate last July. In the first seven months of the year, the outstanding loans to the national economy reached VND12.47 quadrillion, a modest increase of 4.56 percent compared with late 2022, much lower than the targeted 14-15 percent.

This was attributed to weak demand for investment, production and business. Businesses have not fully recovered after the Covid-19 pandemic, and have been impacted by the global economy.

The liquidity of the banking system is plentiful. Banks are not borrowing money from each other, and interbank interest rates are low. The overnight interest rate is at record low 0.2 percent per annum.

Therefore, analysts believe that strong cash flow will run to the stock market as it has nowhere else to go.

The Vietnam Securities Depository (VSD) reported that in July, the number of newly opened securities accounts was over 150,000, the highest level in the last 11 months. This was the third consecutive month that domestic investors had opened more than 100,000 accounts. 

Commenting about the prospect of securities companies, VNDirect Securities said as the State has timely issued a lot of financial and monetary policies to remove obstacles and promote the production and business, enterprises in the economy, including securities companies have reasons to put a high hope on the prosperity in the second half 2023.

VNDirect Securities believes that securities remain one of the most attractive investment business fields with low penetration level and increased incomes. The stock market has shown signs of increases thanks to the loosened monetary and fiscal policies, which would facilitate securities companies’ business.

However, analysts warned the market may be impacted by exchange rate fluctuations. The dong/dollar exchange has increased by 1.4 percent so far this year.

Manh Ha