Illustrative image (Photo: VNA)Hanoi, (VNA) - The following are the top 10outstanding events for Vietnam’s stock market in 2018 as selected by theSecurities Journalists Club.
1. Stock market declines after five consecutiveyears of growth
This year, the stock market witnessed thechoppiest year since the 2008 global financial crisis. The market declined forthe first time after five consecutive years of rallying in parallel with thegrowth momentum of the economy. It achieved a record high gain of 47 percent in2017.
The benchmark VN-Index set an all-time peak of1,211 points on April 10, but then suffered a sharp decline of 27 percent, toreach the bottom of 888 points on October 30 despite the fact that Vietnam’sGDP has posted its strongest growth rate in a decade. The unexpected fall wasattributed to objective reasons such as accelerating trade tension between theUS and China and the interest rate hike trend of central banks worldwide.
2. Explosion of derivatives market
The derivatives market reached a remarkablegrowth in scale just over a year after the start of official operation onAugust 10, 2017. The market’s trading value soared to a record of nearly 17trillion VND per session in October compared to 2.5 trillion VND (107 millionUSD) per session at the end of 2017. The number of derivative trading accountshas increased 2.2 times compared to the end of 2017.
3. Million-dollar deals
This year witnessed many large-scaleacquisitions. The State Capital Investment Corporation (SCIC) and military-runtelecoms group Viettel offloaded their entire stakes, collectively at 79percent, in the Vietnam Construction and Import-Export Joint Stock Corporation(Vinaconex), under the form of a public auction on November 22 on the HanoiStock Exchange, earning 9.36 trillion VND from the deal.
Notable IPO deals include the 5.5 trillion VNDdeal of Binh Son Refinery and Petrochemical Company (BSR), the 4.1 trillion VNDdeal of the PetroVietnam Oil Corporation (PV Oil), the 7 trillion VND deal ofPetroVietnam Power Corporation (PV Power) and the 922 million USD deal ofTechcombank.
4. Vietnamese market added to FTSE’s watch listfor upgrade
In its annual country classification reviewpublished late September, the UK-based data service provider said Vietnam “iscurrently classified as a Frontier market and is being added to the watch listfor possible reclassification as Secondary Emerging market.”
5. HOSE shut down for 2 days
On the afternoon of January 22, the Ho Chi MinhStock Exchange (HOSE) experienced a technical crash, bringing to a halt alltrading activities during the rest of the day and also the next two days onJanuary 23 and 24. This raised the need to renew the market technology platformafter 18 years of operation.
6. Billion-dollar firms attract foreign capital
Four firms – Vietnam’s Housing Development Bank(HDB), Vietnam Technological and Commercial Joint Stock Bank (TCB), Tien PhongCommercial Joint Stock Bank (TPB) and Vinhomes Joint Stock Company (VHM), wereadded to the list of the top 30 listed companies with market capitalisation ofat least 1 billion USD in 2018.
The capitalisation of the whole market has risento its highest level ever, reaching 3.98 quadrillion VND(170.93 billion USD), up 13.5 percent from 2017 and equivalent to 79.6 percent of GDP. The emergence of large-capstocks has drawn the attention of foreign investors, with net buying value of2.9 billion USD in 2018, approximately equal to 2017’s figure of 2.92 billionUSD.
7. Establishment of a state capital management committee
In September, Vietnam’s Committee for StateCapital Management (CMSC), known as the Super Committee, was officiallylaunched, responsible to the Government for effectiveness in the use of Statecapital and assets in SOEs. It is supervised by the Government, the NationalAssembly and law-protecting agencies.
The committee manages 19 State-owned economicgroups and corporations with the total value of State equity reaching more than1 quadrillion VND and total asset value of 2.3 quadrillion VND.
8. Stock price manipulation face penalties
Cases of stock price manipulation receivedadministrative sanctions. Nine individuals were fined 550 million VND each,totalling VNĐ5.1 billion, accounting for more than 25 percent of the totalfinancial penalties in the market in 2018.
Regarding criminal cases, the Hanoi People’sCourt in October opened the first-ever trial in the case of 15 people who werecharged with stock trading document falsification, stock price manipulation andfraudulent asset transfers. The defendants were reported to have falsifiedtrading documents of MTM shares on the Unlisted Public Company Market (UPCoM),manipulated MTM share prices and fraudulently transferred MTM stocks on themarket.
This is one of three criminal cases that werediscovered and prosecuted.
9. The draft revised Law on Securities madepublic
The draft revised law on securities was based onthe inheritance of the current Securities Law, broadening the scope ofregulations and adopting a new approach more suited to market conditions andovercoming the remaining limitations of the current law.
It is supposed to be submitted to the Governmentin the second quarter of 2019 and submitted to the National Assembly forconsideration and approval in the fourth quarter of 2019.
10. Legal framework for the corporate bondmarket
In December this year, the Government issuedDecree No 163/2018/ND-CP regulating the issuance of corporate bonds, replacingDecree No 90/2011/ND-CP dated December 14, 2011, to create a new legal frameworkfor enterprises to raise capital through the issuance of bonds.
The new decree, coming into force from February1 next year, aims at creating favourable conditions for enterprises to raisecapital through issuing bonds, developing the corporate bond market in thedirection of publicity, transparency and protection of interests of privateinvestors, step by step expand the size of the corporate bond market, reducingthe burden of raising funds for bank credit.-VNA
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