THANH CONG SECURITIES COMPANY Floor 3&5, Centec Tower, 72-74 Nguyen Thi Minh Khai, Dis.3, HCMC Phone : + 84 (08) 3 827 0527 Website: www.tcsc.vn MONTHLY REPORT OCTOBER 2012 Research Department research@tcsc.vn 1. Overview macroeconomic 2. Financial market 3. Stock market 4. Stock market in November 2012
OVERVIEW VIETNAM S MACROECONOMIC Vietnam s CPI increases by 0.85% in October The country's CPI is under control this month with an increase of 0.85 per cent after soaring 2.2 per cent in September, the General Statistics Office said. Compared to the figure of last October, the index rose by 7 per cent, a level the office said would help keep inflation rates in single digits this year. Food prices rose by only 0.37 per cent although rice supplies were declining as the summerautumn crops in the South had finished and rice export grew. Healthcare services alone surged 7.78 per cent following many provinces' moves to raise prices in accordance with the Government's guidance. Housing and building material prices expanded significantly at 1.09 per cent, a result of a 4.7 per cent increase in prices of cooking gas and other household fuels. The education service sector saw prices go up 2.1 per cent as the Ministry of Education and Training raised tuition fees in many localities. CPI expanded cumulatively 6.02 per cent in the first 10 months of this year; the average CPI level for this period was up 9.66 per cent over the same period last year.
Vietnam s FDI attraction hits nearly $10.5b in Jan-Oct In the first ten months of 2012, foreign direct investment (FDI) capital disbursement was estimated at $9 billion, equal to 98.9 percent of the same period last year, Overseas Investment Department under the Ministry of Planning and Investment (MoPI). Till October 20, Vietnam has attracted 881 newly-licensed FDI projects with pledged capital of $6.68 billion, or 63.3 percent of the same period last year. In addition, as many as 359 ongoing FDI projects registered to raise investment capital by $3.8 billion, up 12.3 percent from the same period last year. Totally, newly granted and raised FDI capital in Jan-October reached $10.49 billion, equal to 75.3 percent compared to the same period last year. In October alone, FDI capital disbursement reached about $900 million, rising about 9.8 percent from the figure of $820 million in September. Processing and manufacturing sector attracted the most attention of foreign investors with 374 FDI projects valued at $6.9 billion, accounting for 66.2 percent of the total investment capital in Jan-October. Amongst 52 countries and territories investing in Vietnam, Japan took the lead with $4.92 billion, accounting for 46.9 percent of the total FDI capital in Vietnam in Jan-October. Binh Duong province attracted the biggest volume of FDI investment capital with $2.17 billion, accounting for 20.7 percent of the total investment capital
Vietnam estimates to run a trade deficit of $500m in Oct General Statistical Office (GSO) has recently released a report on export and import activities in October and the first ten months of this year whereby in October, the country s export turnover is estimated to have reached $9.9 billion, rising 4.4 percent from September. Totally, in Jan-Oct, the country s export turnover is estimated to have reaped $93.45 billion, a year-on-year increase of 18.4%. The export turnover in Jan-October of FIEs is estimated to have fetched $58.55 billion, accounting for 62.6 percent of the country s total export turnover. Staple export items in October were apparel products ($1.4 billion), electronics products, computer and components ($720 million), telephones and spare parts ($1.3 billion), crude oil (nearly $700 million), footwear ($500 million) and seafood ($550 million). Regarding import, in October, the country s import spending is estimated at $10.4 billion, up 11.7 percent on month, lifting the total figure in Jan-October to $93.807 billion, rising 6.8 percent from the same period last year. Major import commodities in October were petroleum ($890 million), cloth ($600 million), electronic products, computer and components ($1.4 billion) and iron and steel ($565 million). Thus, in October, the country is estimated to have run a trade deficit of $500 million and it would be $357 million in the first ten months of this year.
Vietnam's gross domestic product (GDP) grew by 4.73% in the first nine months Vietnam's gross domestic product (GDP) grew by 4.73% in the first nine months of this year, which is lower than the 5.77% in the same period last year, according to the General Statistics Office (GSO). However, the national GDP rose from 4.0% in the first quarter to 4.66% in the second quarter and to 5.35% in the third quarter. The national rate includes 0.4% growth in the agro-forestry and fisheries sector, 1.82% in industry and construction, and 2.51% in services. The GSO also reported that the country s export turnover earned US$83.789 billion in nine months, a year-on-year increase of 18.9%, while imports reached US$83.755 billion, up 6.6% against the same period last year. As a result, the country enjoyed a trade surplus of US$34 million for the nine-month period.
FINANCIAL MARKET IN OCTOBER 2012 GOVERNMENT BONDS Date Issuer Term Offering value (VND bn.) Winning value (VND bn.) Successful ratio Bidding rate (%) Successful rate (%) No. participants 03/10/2012 VBSP 2 1,000-0% 12.00 1 03/10/2012 VBSP 3 1,000-0% 12.50 1 03/10/2012 VBSP 5 500-0% 13.00 1 05/10/2012 Treasury 2 1,000 850 85% 9.58-10.20 9.70 13 05/10/2012 Treasury 3 1,000 500 50% 9.80-11.00 9.90 8 10/10/2012 VBSP 2 1,000-0% 12.50 1 10/10/2012 VBSP 3 1,000-0% 13.00 1 10/10/2012 VBSP 5 500-0% 13.50 1 11/10/2012 Treasury 2 1,000 950 95% 9.70-10.40 9.80 11 11/10/2012 Treasury 3 1,000 650 65% 9.89-10.50 10.00 8 17/10/2012 VBSP 2 500-0% 11.30 1 17/10/2012 VBSP 3 500-0% 11.50 1 17/10/2012 VBSP 5 500-0% - 19/10/2012 Treasury 2 1,000 1,000 100% 9.60-10.10 9.80 18 19/10/2012 Treasury 3 1,000 710 71% 9.70-10.45 10.00 13 23/10/2012 VDB 2 1,000-0% 11.00-11.30 1 23/10/2012 VDB 3 1,000-0% 11.20-11.50 1 23/10/2012 VDB 5 1,000-0% - 23/10/2012 VDB 10 1,000-0% - 24/10/2012 VBSP 2 500 300 60% 10.80-13.00 10.80 2 24/10/2012 VBSP 3 500-0% 11.50-13.50 2 24/10/2012 VBSP 5 500-0% 14.00 1 29/10/2012 Treasury 2 2,000 2,000 100% 9.45-10.9 9.70 22 29/10/2012 Treasury 3 1,000 940 94% 9.60-10.50 9.85 14 31/10/2012 VBSP 2 500 100 20% 10.80-13.00 10.80 2 31/10/2012 VBSP 3 500 150 30% 10.90-13.50 10.90 2 31/10/2012 VBSP 5 500-0% 14.00 1 In October 2012, Ha Noi trading exchange held ten auctions of bonds issued by Treasury, Vietnam Development Bank and Vietnam Bank for Social Polices with the
total issuing value of VND 22,500 bn. for 2-year, 3-year, 5-year and 10-year bond. According to the results announced in October 2012, total successful amount was VND 8,150 bn., as for 2-year bonds, VND 5,200 bn. worth of bonds were sold, with the interest rate 9.70-10.80% p.a; as for 3-year, VND 2,945 billion worth of bonds were sold with the interest rate of 9.85-10.90% p.a; 5-year and 10-year bonds didn t buy by investors. Successful rate in October was 36.2%, it is higher than last month. In September, the average inter-bank interest rates are bearish for the short-term and bullish for the long-term. In October, interest rate rose in almost terms.
GOLD MARKET Source: SJS After increasing in September, gold price stepped to adjusting period in October. On October 04 th, gold price climbed to its peak at US$1,790/ounce then shrank to US$1,709 on October 31 st. There is the different between domestic gold price and global price because financial institutions were buying gold in order to terminate gold mobilization in compliance with Circular No.12/2012/TT-NHNN. According to calculation of SBV, financial institutions had bought more than 60 tons of gold with six months in order to settle gold contracts. There is still lack of 20 tons of gold. As current buying speed, financial institutions need more 2 months in order to full fill enough gold. The State Bank of Vietnam (SBV) issued Document No.7019/NHNN-QLNH on October 26 to require those credit institutions with gold mobilizing and lending outstanding to take certain actions to terminate gold mobilization in compliance with Circular No.12/2012/TT-NHNN. Credit institutions are allowed to continue issuing short-term gold-denominated certificates until November 24, 2012. After Nov 25, 2012, credit institutions are also banned to convert mobilized gold into the dong or any other monetary forms. They are also restricted from pledging mobilized gold as collaterals to secure any debt obligations at other credit institutions. If the November deadline remained in force, banks would be forced to use available capital to buy needed gold, the central bank said. The extension is expected to ease pressure on local lenders as demand for capital often surge in the final months of the year ahead of the Lunar New Year holiday, a central banker said.
STOCK MARKET IN OCTOBER 2012 Indexes in two markets recovered in first half of October 2012 because investors were waiting for commitment of government at National Assembly meeting. One day before meeting finished, selling pressure increased when investors wanted fix their short-term profit, it led stock market soar in second half of October. On Oct 16 th, VN Index reached closely level of 400 points when it stood at 399.22 points; however, Ho Chi Minh market rebounded to 388.42 points on Oct 31 st. Compared with the closing level in the end of September, VN Index was only back by 4.15 points (-1.1%). Meanwhile. HNX Index had 10/12 decreasing trading days since Oct 16 th. HNX Index at the end of October lost 3.26 points (-5.79%) compared to Oct 16 th. Liquidity of both exchanges continued to be worse, average trading value in two bourse was only VND 723 bn., decreased 17% compared to last month. Total volume on the Ho Chi Minh and Ha Noi exchange in October 2012 was VND 530 bn. and VND 192bn.., respectively with cutback of 18% and 15% compared to the last month. Within
one month, there is more than 115.7 million shares of EIB stock were traded, equivalent to VND 2,568 bn., including 94.3 million shares purchased through negotiation session, equivalent to VND 2,129 bn. If we excluded trading volume of EIB, the total trading value in Ho Chi Minh stock exchange in October was only VND 9,644 bn., decreased by 22% compared to September. October continued to be the net buy month of foreign investors when the net buy volume on both exchanges traded at over VND 238 bn. However, trading value of foreigners soared in this month, total selling and buying value was VND 3,350 bn., slid by 30% compared to last month. MARKET ANALYSIS IN NOVEMBER 2012 Macroeconomic news did not have much improvement, market maybe will decrease before rebound. Investors should hold cash during this period.
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Authors Trang Nguyen Thu trang.nt@tcsc.vn
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