1. Financial market News
Stock market drops over Covid-19 fears
The VN-Index plummeted 3.22 percent to 829.16 points Friday after official reports of the first possible local Covid-19 transmission in three months were released. Vietnam’s benchmark index had fallen as much as 4.7 percent at 1:15 p.m., after coastal Da Nang City announced it had quarantined over 50 people who had close contact with a man tested positive for the novel coronavirus. Equity market sell-offs this session were also the result of gold prices continuously hitting new peaks in the past week, causing capital to exit equity markets and enter this channel. The Ho Chi Minh Stock Exchange (HoSE), on which the VN-Index is based, was a sea of red with 368 stocks losing and 32 gaining. Total trading volume nearly doubled over the previous session to VND7.54 trillion ($325.97 million), the highest single-day trading HoSE experienced this month. The July-to-date average liquidity before Friday stood at VND4.3 trillion ($185.9 million) per session.
Detailed information here.
2. Banking news
Banks act carefully amid uncertainties
As the global health crisis continues to inflict hardship on every sector, both international and domestic banks are becoming more risk averse in order to keep their businesses afloat, while trying to get rid of bad loans.
The domestic economy showed significant signs of recovery, spurring higher demand for loans and higher growth in credit of lenders. Banks are also reducing their lending rates despite impacts on profits from their bread-and-butter lending activities.
Notwithstanding, each lender has their own lending appetite. Tran Thang Long, head of research at BIDV Securities told VIR, “In our opinion, banks would change the risk appetite to become more risk averse, and they would focus on increasing non-interest income which is the main growth factor for banks in the near future.” Long also brought up examples of state-owned banks slashing their credit exposure to the market and focusing on providing loans to their existing customers.
Detail information here.
3. International finance News
Gold surges to record close as U.S.-China tensions escalate and coronavirus concerns rise
Gold prices rose to an all-time high Friday as investors sought safety in the precious metal amid rising U.S.-China tensions and lingering fears over the coronavirus pandemic.
Detail information here.