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Profit-taking sends Index tumbling   2009-06-17 - Viet Nam News

The VN-Index plunged back below 500 yesterday, June 16, dropping 4.37 per cent before closing at 471.97, as heavy profit-taking continued to take a toll on the market.


In Ha Noi, the HASTC-Index also plummeted by 6.13 per cent to end the day at just over 165.
Losers outnumbered advancers on the HCM City Stock Exchange by a whopping 153 to 12, with almost all shares hitting the bottom of their regulated trading bands.

Trading volumes, meanwhile, declined significantly from Monday's session, dropping 47 per cent to 34.7 million shares, with the day's trades totalling VND1.6 trillion (US$90 million).

In Ha Noi, the HASTC-Index also plummeted by 6.13 per cent to end the day at just over 165. The value of the day's trades fell to VND723.3 billion ($40.6 million) on a volume of 21.1 million shares, a drop of 46 per cent from Monday's session. Decliners outnumbered gainers by 170 to 17.

Banking shares still proved the most active on both bourses yesterday, with Sacombank (STB) generating orders for 8.9 million shares - nearly 20 per cent of the total activity on the southern market - while Asia Commercial Bank (ACB) generated 4.6 million transactions on the northern exchange, 22 per cent of total volume.

FPT Securities Co attributed yesterday's moves to sharp falls on the US stock market, accelerated profit-taking, and a General Department of Taxation plan to apply the personal income tax starting this month, pending a vote by the National Assembly.

Bao Viet Securities Co analysts warned that short-term investments were risky at this time and suggested that investors exercise caution. But, they said, investors should consider investing in shares that promised satisfactory second-quarter business results, particularly banking shares.

Second-quarter corporate results were expected to motivate market gains over the next few weeks, they said. Viet Capital Securities Co said in a report that the market had now entered a phase of strong adjustment with the VN-Index having fallen back below 500. The brokerage noted that banks' credit growth rate might slow over the coming weeks and, "if this is true, it means the thriving market is over."

"The market is declining, but demand is quite good at low price levels," said VNDirect Securities analyst Dang Nguyen Cuong, expecting demand to be greater if the market slumped further.

Cuong also directed investors towards real estate development firms, such as Tu Liem Urban Development (NTL) and Song Da Urban-Industrial Zone Investment and Development (SJS).

"Based on our observations of the real estate market recently, along with exchanges with companies, we highly evaluate the growth potential of these firms," he said.

Meanwhile, foreign investor transactions stayed modest yesterday with only around 4.4 million shares changing hands on the HCM City Stock Exchange. They finished the day as net sellers of 314,000 shares, worth VND31.2 billion ($1.8 million).

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