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|Local stock exchange experienced the worst hit for 19 years|
Vietnam’s securities market experienced the worst hit of the past 19 years due to the COVID-19 outbreak. Specifically, the VN-Index dropped by 6.3 per cent and the HNX-Index fell by 6.4 per cent.
HSX recorded 368 stocks in red, as opposed to only 34 stocks in green. In the VN30, 22 tickers went into a nosedive during the session on March 9. These included 19 stocks that saw no trading, even at lower prices.
Zing.vn quoted Nguyen The Minh, analysis director at Yuanta, as saying that the drop stems from the growing fear of COVID-19 as more infections are detected in Vietnam.
This is similar to the downturn in the South Korean stock market when the first coronavirus cases were discovered.
“The panic of investors is reflected by the bargaining of major stocks away these days,” said Minh.
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Besides, the downturn is felt across the globe, not only in Vietnam. Most Asian stock indexes have been down by more than 2 per cent, and oil also hit rock bottom. “These are negative factors holding back the local stock exchange.”
Nevertheless, Yuanta’s representative also pointed out that the current shocks will not last long, similar to the fallout of previous SARS and H5N1 crises. Accordingly, the market at the time also recorded a sharp fall but quickly rebounded as soon as positive signs appeared.
He said that the epidemic has yet to cause any relevant medium- or long-term impacts to the economy. Moreover, foreign investors have lowered net sales, which means they do not agree with local investors’ acts of bargaining away. Additionally, FED can continue to cut interest rates after last week. This would shift money flows to the other new stock markets, including Vietnam.