The Ho Chi Minh City Stock Exchange (HSX) had to shut down temporarily to prevent technical outrages due to excessive liquidity.
In an announcement made in the morning of June 1, the HSX explained that its platform was paralysed after the trading value exceeded VND21.7 trillion($943.5 million), leaving millions of investors unable to trade.
With the approval of the State Securities Commission, the HSX halted transactions on June 1. The session was closed with the last matching price in the morning session. Thus, the VN-Index closed with an increase of 9.73 points (0.73 per cent) at 1,337.78 points.
Furthermore, the HSX recommended securities companies to notify their institutional and retail investors until the next announcement is published.
The morning session was led by positive sentiment. However, investors were under pressure to realise profit, rapidly increasing selling pressure.
This is the first time in history that the HSX suspended transactions to protect infrastructure and prevent technical outrages due to excessive liquidity.
Particularly, not only could the electric board not function but most of online platforms, including webtrading and mobile trading apps of many securities companies, also suffered a massive technical failure triggered by the frenetic trading.
While transactions could not be executed on the HSX platform, Hanoi Stock Exchange (HNX) and UPCom were still trading normally in the afternoon session. The HNX-Index closed up 0.36 per cent at 319.01 points and UPCom-Index increased 0.11 per cent to 88.87 points.
The domestic stock market has been very active in the past two weeks, with matching transactions on HSX alone increasing for five consecutive trading sessions. This is a major challenge, especially in the context of HSX’s age-old trading infrastructure.
The overloading issue of the HSX has been subject of controversy over the past few weeks, with the blame being attributed to poor management and an age-old technology.