Bank move cheers investors

July 13, 2012 | 17:00

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Stock market soared on major banks’ moves to lowering lending rates, with rising hope about an upswing among investors.

Ho Chi Minh Stock Exchange’s VN-Index gained 8.26 points or 2.02 per cent to 416.98 points, while the HNX-Index of Hanoi Stock Exchange (HNX) advanced 1.25 points or 1.8 per cent to 70.57 points.

Notably, liquidity soared as well. Matching values more than doubled to VND705 billion ($34.1 million) on HoSE, compared with just VND300 billion ($14.5 million) in yesterday’s session. Value hit VND441 billion ($21.3 million) on HNX.

Total trading volume was 55.7 million shares worth VND763.7 billion ($36.9 million) on HoSE and 57 million shares worth VND493.1 billion ($23.8 million) on HNX.

Since late this week, several banks revised down their lending rates to 15 per cent per annum or lower for existing loan, in accordance with a State Bank request. At the same time, the State Bank provided a much higher estimate of non-performing loans, which some observers saw as an improvement in banking industry transparency.

Cash aggressively flew into speculative stocks. Real estate small-cap stocks Vietnam Electricity Construction (VNE), Hoang Quan Consulting-Trading-Service Real Estate Corp. (HQC), PetroVietnam-Idico Long Son Industrial Park Investment (PXL), Hoa Sen Group (HSG) hit the ceiling with large matching volumes.

Tan Tao Investment Industry Corp. (ITA) outperformed the market again with 3.6 million shares, jumping 2.94 per cent. Major stock in real-estate sector like Vincom Group (VIC), Song Da Urban & Industrial Zone Investment and Development (SJS) and Kinh Bac City Development Share Holding Corp. (KBC) also soared

High-liquid stocks in mineral and rubber sectors also strongly rallied, among them Nari Hamico Minerals (KSS), Binh Thuan Mineral Industry (KSA), Southern Rubber Industry (CSM), Danang Rubber (DRC) active the most.

Blue-chips also saw a positive session, but the gains were more modest. Masan Group (MSN) gained 1.55 per cent while Vietnam Dairy Products (VNM) up 1.16 per cent.

Banking stocks Sacombank (STB) ended flat, Eximbank (EIB) added 0.54 per cent, Vietcombank (VCB) 2.14 per cent, Vietinbank (CTG) up 1.48 per cent. Observers are concerned that the move of banks lowering lending rate might hurt their profit margins, leading to banking stocks being less attractive at the moment.

Meanwhile, Military Bank (MBB) hit the ceiling with 1.8 million units matched.