Suspect trading to be made public

Vietnam’s fledgling bourse is a potential target for price manipulation

“Securities trading centres have to immediately make public any information about stocks that hit the ceiling prices or drop to floor limits within five consecutive trading days to alert investors about the situation,” the State Securities Commission (SSC) announced on its website.
The information would also include preliminary analysis data and opinion from relevant bodies to help investors avoid risks, while the SSC investigated cases.
The SSC announcement was made after several stocks on the Ho Chi Minh City and Hanoi exchanges showed unusual transaction signs.
“I totally agree with the market regulator. If no action is taken, inexperienced investors may lose out and the development of a young securities market like Vietnam would be unhealthy,” said Nguyen Minh Tue, a Hanoi-based retail investor.
Price manipulations usually occur when the number of company shares is small and they lack liquidity. For example, stocks such as SIS, BTC and HAX should be investigated, said another investor, Nguyen Van Hoa.
The market regulator said it would further investigate the case of Ho Chi Minh City stock exchange-listed BMC stock and others, which hit its daily ceiling limit of 5 per cent on consecutive trading days without an apparent reason.
BMC debuted on December 28 last year at VND50,000 a share, but it soared to VND847,000 on May 21 and stood at VND575,000 on June 11 after investors were given an additional two shares, for every share held, as a dividend.
BMC shares then plunged to VND512,000 on June 27 after an investigation was announced.
Investors also questioned the price of Cho Lon Property developer (RCL) shares, which debuted on the Hanoi exchange at an initial price of VND150,000 a share. RCL then jumped to VND300,000 within seven consecutive days before stepping down to VND213,000 each on June 27. RCL had 1.5 million shares, but only around 300,000 shares were available for transactions.