Stocks nosedive on bank scandal

On the HCM City Stock Exchange, the VN-Index yesterday closed off 1.81 per cent to end the session at 580.80 points, the lowest since July 3. - Photo Vnexpress

On Friday, Ha Van Tham, former chairman of Ocean Group (coded OGC) and Ocean Bank was arrested for allegedly violating lending regulations. After the news broke, OGC shares tumbled 6.42 per cent to close at VND10,200 a share.

OGC leaders have responded quickly to the situation, assigning other members of the board of directors to ensure normal operations at the bank.

Last year, the stock market had nosedived to its lowest point in several years after bank tycoon Nguyen Duc Kien was detained for business wrongdoings.

On the HCM City Stock Exchange, the VN-Index yesterday closed off 1.81 per cent to end the session at 580.80 points, the lowest since July 3.

The VN30 which tracks the top 30 shares by market value and liquidity also dropped 2.28 per cent to finish at 615.15 points as up to 29 stocks sank and just one remained flat.

Liquidity improved slightly compared with Friday as both market volume and value increased 10 per cent, totaling over 104 millions shares worth VND1.754 trillion (US$83 million).

Trading in Tan Tao Investment Industry Corp (ITA) shares rose in the afternoon, pushing the share to the most active position with nearly 6.7 million traded. ITA prices dropped 4.71 per cent, however, to finish at VND8,100 a share.

OGC came second in the market volume with 6.55 million shares changing hands, diving 6.4 per cent to settle at VND10,200 a share.

Analysts said that investors showed increasing impatience in the afternoon session. This pessimism could extend to today's trading and continue to pull down the market, they said.

On the Ha Noi Stock Exchange, the HNX-Index fell by 3.07 per cent to close at 84.38 points and the HNX30 sank 3.98 per cent to stand at 176.48 points.

The market volume changed little from the previous session at 58.6 million shares worth VND781 billion ($37 million).

PetroVietnam Construction Corp (PVX) continued to lead the market volume with 8.1 million shares traded, but it's share price plunged 5.17 per cent to end at VND5,500 a share.

Foreign investors remained net buyers in the HCM City market with a net buy value of over VND7.3 billion ($346,000) but they sold strongly on the Ha Noi Stock Exchange, accounting for VND31.11 billion ($1.5 million) worth of shares.