Market plunges on Kien’s arrest

August 21, 2012 | 18:00

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The stock market plunged this morning on the news of Asia Commercial Bank’s (ACB) co-founder Nguyen Duc Kien being arrested.

Local media quoted their sources that Nguyen Duc Kien, a major banking sector influence with the roles of co-founder in Asia Commercial Bank (ACB) and major shareholder in several banks like Eximbank (EIB), was prosecuted on charges of illegal business.

The news strongly stirred up investors as they feared negative impacts on the banking system.

Both bourses nosedived from the opening of the session. ACB hit the floor with more than 3 million shares being offered until 10.00am. Eximbank (EIB) and Sacombank (STB) hit the floor as well.

Vietcombank (VCB), Vietinbank (CTG) and Military Bank (MBB) sharply fell with hundreds of thousand shares offered.

Both bourses sunk in red with investors rushing to sell out their holdings. Decliners totally overwhelmed advancers. More than 400 stocks were down on the two bourses while just some 40 stocks up.

“There is hardly anything to support such news [of Kien being arrested],” said Hoang Quan, a broker in VNDirect Securities.
Ho Chi Minh Stock Exchange’s (HoSE) VN-Index plunged more than 17 points or some 4 per cent in the 10.00am. Hanoi Stock Exchange (HNX) slipped nearly 5 per cent.

However, bottom fishing significantly increased. The trading value on the HoSE until 10.30 am reached nearly VND900 billion ($43.5 million), doubling the whole value in yesterday’s session.

The value was of some VND400 billion ($19.3 million) on HNX. The market is fluctuating with the strongly active trading of both buyers and sellers.