Vietnam Business & Weather Briefing (Sep 6): Petrol prices further down

Business Briefing

Gold rate

On September 6, the price of SJC gold bars increased by VND 100,000 per tael. The buying price of gold in Eximbank is listed at VND 65.6 million/tael, the selling price is VND 66.6 million/tael.

At Saigon Jewelry Company - SJC, the buying gold price is VND 66 million/tael, the selling price is VND 68.8 million/tael.

Photo: Zing News

Reference exchange rate

The State Bank of Vietnam set the daily reference exchange rate for the US dollar at VND 23,245/USD on September 6, up VND 18 from the previous day. With the current trading band of +/-3 percent, the ceiling rate applied to commercial banks during the day is VND 23,942/USD, and the floor rate VND 22,547/USD.

The opening-hour rates at commercial banks decreased. At 8:35 am, BIDV listed the buying rate at VND 23,400/USD and the selling rate at VND 23,680/USD, both down VND 10 from the rates at the end of the previous session. Vietcombank listed the buying rate at VND 23,370/USD and the selling rate at VND 23,680/USD, unchanged from September 5.

Photo: Vietnamnet

Petrol price

Petrol prices were reduced in the latest adjustment made on September 5 by the Ministries of Industry and Trade, and Finance. The retail price of E5RON92 bio-fuel slid by VND 370 to a maximum of VND 23,350 (USD 0,99) per liter while that of RON95-III was cut by VND 430 to VND 24,230 per liter.

Meanwhile, the price of diesel oil was raised by VND 1,430 to VND 25,180 per liter, and that of kerosene was up by VND 1,390 to VND 24,440 per liter. Mazut oil 180CST 3.5S fetched VND 16,540 per kg, a decline of VND 470. The two ministries also determined to extract VND 451-493 per liter from petrol prices and VND 100-300 per liter from diesel and kerosene prices for the petrol price stabilization fund.

Photo: VietnamPlus

Stock market news: Vietnam one of world's best-performing stock markets in August

After declining in the first two quarters, the VN-Index showed signs of recovery in the first half of the third quarter. Last month, the benchmark even witnessed an outstanding breakthrough with a gain of more than 74 points, or 6.2%, over the previous month. The strong recovery helped the VN-Index become one of the world's top performing stock markets in August, said the financial website cafef.vn, citing statistics from Stockq.

The index's performance surpassed most markets in the region, such as Malaysia, Singapore, Indonesia, and Thailand, with these markets' growth in a range of 0.5-4.3%, but it just lagged behind the Philippines' benchmark, which was up 6.9% in August. The market capitalization of the Ho Chi Minh Stock Exchange (HoSE) also advanced by VND 300 trillion ( USD 12.74 billion) last month, with an average trading value on three exchanges reaching 18.5 trillion VND, up 34% month-on-month.

As the benchmark VN-Index ended last month at 1,280.51 points, its price-to-earnings ratio (P/E) was 13.67x, 12.95 times higher than that at the end of July, according to data from Algo Platform. The attractive valuation was one of the factors luring bottom-fishing cash flows to the market. Last month's capital flows were circulated in many industries like retail, securities, chemicals, oil and gas, and construction materials, supporting the market's rallies.

According to VNDirect Securities Corporation, the index's rebound was driven by some events, including the easing inflation in the US and Vietnam, the improvement of the domestic market's sentiment with expectations that the US Federal Reserve would slow down its rate hike in the last quarter of the year, and speculative cash flows.

Photo: Cong Thuong

Liquidity also recovered significantly, with the average trading value on HoSE of nearly VND 15.8 trillion per session in August, an increase of 36% over the previous month. Liquidity bounced back in all sectors. However, the liquidity's recovery was not in line with a gain in new investors. In July, the number of new accounts was only 198,988, a decrease of 57% from the record set in June. This was also the lowest since last November.

Activities of foreign investors were also more positive after net selling in July. Their trading value totaled VND 45.46 trillion last month, of which they purchased nearly VND 23.3 trillion and sold VND 22.29 trillion. Therefore, foreign investors net bought a value of VND 980 billion, the monthly lowest value since the beginning of 2022. In its latest update, VNDirect said that the current market's valuation is appealing to long-term investors looking for enterprises with high-profit growth. With the strong growth of earnings per share (EPS) during 2022-2024, the securities firm said that the Vietnamese stock market is still more attractive than in the past and other regional markets.

Vietnam is a bright spot among emerging markets with a forward P/E of 12.2x in 2022 and the predicted 10.4x in 2023, much lower than the average P/E in the last five years. The market's background is improving, and the correction is creating opportunities for disbursement for investors to build portfolios in the fourth quarter and 2023. Meanwhile, according to Vietnam Maritime Commercial Joint Stock Bank (MBS), the market is likely to be affected by the correction of the global market, but may quickly rebound thanks to the diversified cash flows. Therefore, the declines will be chances to restructure portfolios.

Data from the last ten years showed that September is always the month posting a positive growth rate. Thereby, the domestic stock market may move in a different direction to global negative trends. In its bullish scenario, if the VN-Index returns to 1,300 points, the cash inflows will rise to break over July's peak of 1,315 points and head toward the 1,350 point level. However, in the basic scenario, the index will trade sideways and hover around 1,280-1,305 points.

Photo: Dan Tri

Weather Forecast

From the night of September 6, in the middle and southern areas of the South China Sea (including the waters of the Truong Sa archipelago), there will be showers and thunderstorms. During thunderstorms, there is a possibility of tornadoes. Areas from Thua Thien Hue to Binh Thuan, Central Highlands, and the South will have showers and thunderstorms.

From the night of September 7 to about September 12, in the delta, midland and coastal areas of the North and from Thanh Hoa to Quang Tri, there will be rain and thunderstorms.

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