During the morning trading session on June 12, foreign investors aggressively offloaded VEA shares. By 10:30, nearly 390,000 VEA shares were sold by foreign investors, while only 9,500 shares were purchased.

As a result of substantial selling pressure from both domestic and foreign investors, VEA shares plummeted by VND2,000 to VND45,400/share by 10:30. Throughout the morning session, VEA experienced a further decline of VND2,800 to VND44,600/share.

Nevertheless, there was notable bottom-fishing demand, with over 3.8 million VEA shares exchanged within the first hour and a half of trading on June 12, equivalent to the average daily trading volume over the past 10 sessions.

The heavy sell-off of VEA shares followed news of the prosecution of General Director Phan Pham Ha for alleged abuse of position and power during official duties. This development comes after previous prosecutions within VEAM, including that of former General Director Nguyen Thanh Giang and Deputy General Director Ho Manh Tuan for violating regulations on state asset management, resulting in loss and waste.

An initial investigation revealed irregularities in the purchase of 305 sets of SV 110 car cabin stamping dies in 2005 and 2011, which incurred a loss of over 26 billion VND in state funds due to their lack of utility value.

VEAM has faced additional challenges, including the ongoing auction of over 2,100 cars, left exposed to the elements in Thanh Hoa province, which have failed to attract buyers despite significant price reductions. The inventory, with a cost price of 878 billion VND, is currently listed for sale at a starting price of 500 billion VND.

The repercussions of these developments extend beyond VEAM, impacting the broader stock market. On the morning of June 12, selling pressure persisted across many key stocks, causing the VN-Index to drop by approximately 2 points to 1,282 points. Liquidity remained weak.

Foreign investors continued to sell off key stocks such as Vingroup (VIC), Vinhomes (VHM), Vincom Retail (VRE), VPBank (VPB), FPT, and Vinamilk (VNM) on June 12. This selling trend follows the previous session where foreign investors recorded net sales of VND 1,900 billion, marking a record high in the past 18 months.

Despite the resilience of domestic cash flow amidst low bank interest rates and sluggish real estate transactions, the withdrawal of tens of thousands of billions of VND by foreign investors has impacted market sentiment and liquidity, posing challenges to the recovery of the VN-Index.

Manh Ha